Retirement is an important later life transition which may represent a critical period for physical activity in older age. Past findings on the association between retirement and physical activity are inconclusive and there is some evidence that the physical activity implications of retirement may differ by occupational activity level. This study used data from waves 4-9 (June 2008-July 2019) of the English Longitudinal Study on Aging to evaluate whether there is an association between retirement and physical activity, and whether this varies across occupational activity groups. Retirement was associated with a significant increase in physical activity (n = 10,693; β: 0.602 METhrs/wk. [95% CI: 0.490, 0.713], p < 0.001). There were significant interactions between retirement and past occupational activity level (n = 5109; X2 (3)=32.59, p < 0.001), such that people retiring from sedentary or standing occupations experienced a significant increase in physical activity with retirement but retirement from an occupation involving heavy manual labour was associated with a decrease in physical activity. This study quantified the importance of retirement for later life physical activity. With demographic aging, the population health importance of later life physical activity will likely become more important. These findings should inform the design of public health interventions to increase physical activity around the retirement transition.