BACKGROUND: Physical activity (PA) is inversely associated with obesity but the effect has been difficult to quantify using questionnaires. In particular, the shape of the association has not yet been well described. Pedometers provide an opportunity to better characterize the association. METHODS: Residents of households over the age of 25 years in randomly selected census districts in Tasmania were eligible to participate in the AusDiab cross-sectional survey conducted in 1999-2000. 1848 completed the AusDiab survey and 1126 of these (609 women and 517 men) wore a pedometer for 2-weekdays. Questionnaire data on recent PA, TV time and other factors were obtained. The outcomes were waist circumference (in cm) and body mass index (BMI) (kg/m(2)). RESULTS: Increasing daily steps were associated with a decline in the obesity measures. The logarithmic nature of the associations was indicated by a sharper decline for those with lower daily steps. For example, an additional 2000 steps for those taking only 2000 steps per day was associated with a reduction of 2.8 (95% confidence interval (CI): 2.1,4.4) cm in waist circumference among men (for women; 2.2 (95% CI: 0.6, 3.9 cm)) with a baseline of only 2000, steps compared to a 0.7 (95% CI 0.3, 1.1) cm reduction (for women; 0.6 (95% CI: 0.2, 1.0)) for those already walking 10,000 steps daily. In the multivariable analysis, clearer associations were detected for PA and these obesity measures using daily step number rather than PA time by questionnaire. INTERPRETATION: Pedometer measures of activity indicate that the inverse association between recent PA and obesity is logarithmic in form with the greatest impact for a given arithmetic step number increase seen at lower levels of baseline activity. The findings from this study need to be examined in prospective settings.