The incidence of both diabetes mellitus (DM) and dementia increases with aging and the incidence of dementia are higher in people with diabetes. Epidemiological and pathological data suggest that DM contributes to mild cognitive impairment (MCI) and dementia. DM seems to be an independent risk factor for MCI and Alzheimer's disease (AD) and is associated with more rapid cognitive decline. Recent evidence points out that insulin affects central nervous system functions, and can modulate cognitive functions. Impaired insulin signaling and insulin resistance in brain have been found to play an important role in the pathogenesis of AD. Human studies have shown that some oral antidiabetic medications can improve cognition in patients with MCI and AD. Intranasal insulin has also been shown to improve memory and cognitive abilities in MCI and AD patients. While it remains unclear whether management of diabetes will reduce the incidence of MCI and AD, emerging evidence suggests that diabetes therapies may improve cognitive function.