Background Patients with cerebral small vessel disease may suffer from varying levels of cognitive deficit and may progress on to vascular dementia. The extent of involvement, as seen on conventional magnetic resonance (MR) measures, correlates poorly with the level of cognitive decline. The purpose of this study was to investigate the utility of diffusion tensor imaging (DTI) as a marker for white matter damage in small vessel disease and to assess its correlation with cognitive function. Methods Thirty consecutive patients with cerebral small vessel disease underwent conventional MR imaging, DTI, and neuropsychological assessment. Results On tractographic analysis, fractional anisotropy was significantly reduced while mean diffusivity significantly increased in several white matter tracts. The alteration in DTI indices correlated well with cognitive function. No significant correlation was identified between T2 lesion load and cognitive performance. Conclusions Tractographic analysis of white matter integrity is a useful measure of disease severity and correlates well with cognitive function. It may have a significant potential in monitoring disease progression and may serve as a surrogate marker for treatment trials.