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Introduction: Recent studies highlight the negative impact of social isolation and involvement in leisure activities on enhanced well‐being of individuals. However, there is dearth of evidence on relationship between social isolation and leisure activities on cognitive abilities and depression of older adults in the Indian context. The paper reports the impact of social isolation and leisure activities on cognitive functioning and depression of older adults. Methods: Data were collected from the Longitudinal Ageing Study of India (LASI), and 63,806 participants aged 45 years or above were considered for the study with adherence to the exclusion criteria. Multivariate analysis was carried out to analyse the group‐based differences. Results: Social isolation (F = 102.09, p < 0.01; η2 = 0.09) and leisure (F = 224.54, p < 0.01; η2 = 0.07) had a statistically significant impact on the cognition and depressive symptoms of participants. Socially isolated older adults with little involvement in leisure activities had the worst cognitive functioning (M = 32.76, SD = 4.41), whereas middle‐aged adults who were actively involved in leisure activities and experienced the least social isolation exhibited the best cognitive functioning (M = 32.76, SD = 4.41). However, leisure and age as independent factors did not have a significant impact on depression. Conclusion: Socially isolated participants, irrespective of age, and involvement in leisure activities exhibit poor cognitive functioning and are more likely to suffer from depression as compared to their counterparts. The findings of the study can be used to design intervention strategies aimed at reducing social isolation by incorporating leisure activities to ensure the optimal functioning of middle‐aged and older adults. Key points: Socially isolated older adults with least involvement in leisure activities reported the worst cognitive functioning.Socially isolated participants reported a positive association with depressive symptomatology.Both middle‐aged and older adults who engaged in leisure activities reported better cognitive functioning as compared to their counterparts who did not engage in any form of leisure activities.Leisure as an independent factor is not significantly associated with depressive symptoms. [ABSTRACT FROM AUTHOR]