It has been suggested that rapid eye movement (REM) sleep measures may be useful in the differential diagnosis of affective disorders. To determine what changes, if any, of REM measures occur in Alzheimer's dementia we examined the REM sleep of nine control and nine mild, nine moderate, and nine severe dementia subjects with probable Alzheimer's disease (AD). Control and mild and moderate AD groups were screened to exclude major depression. REM latency, REM time, REM activity, and REM density were examined. Results indicated that REM sleep measures are minimally affected by mild dementia. None of the REM sleep variables reported here successfully discriminated mild AD subjects from controls. However, REM time and REM latency were significantly affected in later stages of dementia. Total time in REM and REM latency successfully classified control and moderate-severe AD patients. In addition, the pattern of REM density across the night was also affected by severity of dementia. The results of this study, when compared to published REM measure findings in major depression, indicate that with proper cautions REM sleep measures may prove useful in the differential diagnosis of dementia and depression in geriatric patient populations.