The behavioral and psychological symptoms of dementia (BPSD) often present major problems for patients and their caregivers. In the past, neurologists paid less attention to such symptoms than to the cognitive symptoms of dementia. This prospective study investigated the prevalence of psychiatric morbidity in a neurology-based memory clinic and the stress of caregivers. Our patients with dementia were found to have a high prevalence of BPSD. The most frequent were anxiety, apathy, and delusion; the most distressing to caregivers were agitation, anxiety, delusion, and sleep disturbance. Using Clinical Dementia Rating (CDR), we compared BPSD between patients with mild dementia and those with moderate dementia. Only hallucinations and agitation were different significantly. Moderate dementia patients experienced these symptoms more frequently. The high prevalence of these symptoms might be explained by the fact that the cognitive symptoms were neglected or no enough information were received by many family members of patients with dementia until their own life quality was interfered and then they began to seek medical help. These symptoms and their effect of caregiver distress can be effectively reduced by pharmacologic and nonpharmacoloic managements, caregiver-focused training and education. They can be better approached by assessing neuropsychiatric symptoms regularly, educating the general population better, and treating these patients earlier.