Objectives: The 10-item Kessler Psychological Distress Scale (K-10) is a widely applied distress measure; however, its psychometric properties were not established with older populations using advanced methodology. The aim of this study was to examine psychometric properties of the K-10 through application of Rasch methodology and if possible, develop an ordinal-to-interval conversion to improve its reliability in older populations. Method: The Partial Credit Rasch Model was applied to analyse K-10 scores of the sample including 490 participants (56.3% females) aged 70 to 90 years and without dementia from the Sydney Memory and Aging Study (MAS). Results: The initial analysis of the K-10 showed poor reliability and significant deviation from the expectations of the Rasch model. The best model fit was evident after correcting disordered thresholds and creating two testlet models to address local dependency between items (χ2(35)=29.87, p=0.71). The modified K-10 demonstrated strict unidimensionality, enhanced reliability and scale invariance across personal factors, such as sex, age, and education and permitted development of ordinal-to-interval transformation algorithms. Limitations: Ordinal-to-interval conversion can only be applied for older adults with complete data. Conclusions: The K-10 satisfied principles of fundamental measurement defined by Rasch model after minor modifications. Clinicians and researchers can transform K-10 raw scores into interval-level data using converging algorithms published here without altering the original scale response format, which increases reliability of the K-10.