Purpose: To examine longitudinal changes of retinal thickness and retinal sensitivity in patients with intermediate age-related macular degeneration (iAMD) and predominantly reticular pseudodrusen (RPD). Methods: At baseline 30 eyes of 25 iAMD patients underwent optical coherence tomography imaging, mesopic and scotopic fundus-controlled perimetry (FCP) with follow-up examinations at month 12 (20 eyes), 24 (12 eyes), and 36 (11 eyes). Thicknesses of different retinal layers and results of FCP testing (n = 56 stimuli) were spatially and longitudinally analyzed using linear mixed-effects models. Results: At baseline, the thickness of the partial outer retinal layer (pORL, 70.21 vs. 77.47 µm) and both mesopic (16.60 vs. 18.72 dB) and scotopic (12.14 vs. 18.67 dB) retinal sensitivity were decreased in areas with RPD compared with unremarkable areas (P < 0.001). Over three years, mean change of pORL was -0.66 normative standard deviation (SD; i.e., z-score, P < 0.001) for regions with existing RPD, -0.40 SD (P < 0.001) for regions with new occurring RPD, and -0.17 SD (P = 0.041) in unremarkable regions. Decrease of scotopic and mesopic sensitivity over three years was more pronounced in areas with existing (-3.51 and -7.76 dB) and new occurring RPD (-2.06 and -5.97 dB). Structure-function analysis revealed that 1 SD decrease of pORL thickness was associated with a sensitivity reduction of 3.47 dB in scotopic and 0.79 dB in mesopic testing. Conclusions: This study demonstrates progressive outer retinal degeneration and impairment of photoreceptor function in eyes with iAMD and RPD over three years. Preservation of outer retinal thickness and reduction of RPD formation may constitute meaningful surrogate endpoints in interventional trials on eyes with AMD and RPD aiming to slow outer retinal degeneration.