This paper reviews aspects of existing knowledge and recent concepts related to the development of vascular dementia which, after Alzheimer's disease, is the most frequent type of dementia. The disorder may result from cerebrovascular disorders, including multi-infarct dementia due to thromboembolic disease, other less common vasculopathies and ischemic brain damage secondary to systemic hypotension. Characteristic clinical features are stepwise cognitive deterioration resulting from repeated strokes and the presence of focal signs and symptoms. The clinical distinction between Alzheimer's disease and vascular dementia may be difficult and strict criteria (NINDS/ AIREN) have recently been adopted as standard guidelines for research studies. Vascular dementia and Alzheimer's disease can co-exist, so-called "mixed dementia", and the presence of cerebrovascular disease may worsen Alzheimer dementia. Indeed, there is often a vascular component in the pathogenesis of dementia. The pathogenesis of vascular dementia is complex. Post-stroke patients are at increased risk; some predisposing or risk factors are the volume, number and site (whether strategic or not) of cerebral injuries, distal field vascular injury with reduced cerebral blood flow, white matter ischemia due to small vessel disease, the co-existence of vascular disease and Alzheimer's dementia, and the presence of cognitive decline prior to stroke. There is increasing evidence of a complex relationship between vascular dementia and Alzheimer's disease. When post-stroke dementia is progressive this may reflect associated Alzheimer's disease either unrecognized or asymptomatic prior to the stroke. The apolipoprotein E4 genotype is a risk factor for ischemic stroke, vascular dementia and Alzheimer dementia. Although dementia is usually irreversible, it is now accepted that cognitive impairment may be delayed, stabilized or sometimes reversed. The treatment of vascular dementia consists of two approaches: preventive measures, including attempts to control risk factors for stroke and the use of antiplatelet agents and/or surgery, and the treatment of cognitive symptoms. Nootropic and vasodilator agents have been reported to improve cognitive impairment from various causes. Ongoing research is attempting to show their specific benefit in vascular dementia.