Quantifying daily physical activity in older adults can provide relevant monitoring and diagnostic information about risk of fall and frailty. In this study, we introduce instrumented shoes capable of recording movement and foot loading data unobtrusively throughout the day. Recorded data were used to devise an activity classification algorithm. Ten elderly persons wore the instrumented shoe system consisting of insoles inside the shoes and inertial measurement units on the shoes, and performed a series of activities of daily life as part of a semi-structured protocol. We hypothesized that foot loading, orientation, and elevation can be used to classify postural transitions, locomotion, and walking type. Additional sensors worn at the right thigh and the trunk were used as reference, along with an event marker. An activity classification algorithm was built based on a decision tree that incorporates rules inspired from movement biomechanics. The algorithm revealed excellent performance with respect to the reference system with an overall accuracy of 97% across all activities. The algorithm was also capable of recognizing all postural transitions and locomotion periods with elevation changes. Furthermore, the algorithm proved to be robust against small changes of tuning parameters. This instrumented shoe system is suitable for daily activity monitoring in elderly persons and can additionally provide gait parameters, which, combined with activity parameters, can supply useful clinical information regarding the mobility of elderly persons.