The elderly population of the world is growing fast. The aging phenomenon causes changes in the body’s systems, leading to mental and emotional disorders. Dementia is established as one of the most important challenges associated with the aging process. In this respect, the Montessori-based cognitive rehabilitation program is an increasingly popular choice in dementia care. Therefore, we decided to conduct a review study on the effect of Montessori therapy on different psychological aspects of the elderly with dementia. This narrative review was performed using narrative synthesis. An extensive literature search was performed in databases of ScienceDirect, Google Scholar, PubMed, and ISI Web of Knowledge using OR, AND, and NOT operators and the selected keywords. Only studies published in journals between March 2010 and March 2022 were used for this purpose. The articles chosen in this study were those that have studied the effect of a Montessori-based cognitive rehabilitation program on the elderly with dementia. Studies that involved the Montessori program on other neurological disorders were excluded. Finally, 32 articles were selected from the final evaluation. It can be concluded that the Montessori program effectively reduces anxiety, destructive behavior, and agitation, increases pleasure, hope, optimism, job satisfaction, social skills, and cognitive function, and improves the quality of life and feeding capacity.