Background: Rising health-related economic inactivity (IN-HLT) is a growing concern in the United Kingdom, yet little is known about whether its relationship with chronic health conditions has changed across generations. Methods: Using data from two large birth cohort studies representative of people born in Britain in 1958 (n = 9761) and 1970 (n = 7336), we quantified associations between physical and mental ill-health at age 42 with IN-HLT at age 50-54 using multinomial logistic regression models, adjusting for previous economic activity and a rich set of lifecourse sociodemographic characteristics, and estimated average marginal effects (AME). Results: Ill-health, particularly longstanding illness and mental ill-health, were associated with a higher risk of IN-HLT in both cohorts. Having a longstanding illness at age 42 was associated with 5 to 6 percentage-point higher risk of IN-HLT (AME1958 = 5.1 [95% Confidence Interval (CI) 2.1, 8.1], AME1970 = 6.5 [95%CI 3.4, 9.6]), and psychological distress with a 4 percentage-point higher risk (AME1958 = 3.8 [95%CI 0.4, 7.1], AME1970 = 4.5 [95%CI 1.1, 7.8]). Except for high blood pressure, which was associated with IN-HLT in the 1958 cohort only, the magnitude of associations between chronic conditions and IN-HLT was similar across generations despite them experiencing different economic and policy contexts. Implications: Given increases in obesity and mental ill-health prevalence across successive British birth cohorts, our findings suggest that both primary prevention and policies to better support individuals with chronic health conditions to remain and return to economic activity are needed to sustain later-life labour force participation.