This review summarizes studies on the natural history of dementia with a focus on Alzheimer's disease and vascular dementia. Understanding the course of dementia is important not only for patients, caregivers, and health professionals, but also for health policy-makers, who have to plan for national resources needed in the management of an increasing number of dementia cases. From the available published data, the life expectancy of elderly people with dementia is shorter than that of non-demented elderly. Reports on survival after a diagnosis of dementia vary from 3 to 12 years. The wide variation is partly due to the diagnostic criteria used in the studies and the sites where they were conducted (i.e. hospitals, clinics, or homes). There is an apparent difference in survival between Alzheimer's disease patients with onset of illness before 75 years and those after 75 years: the younger patients have a longer life expectancy. However, there are conflicting data on survival (in years) comparing male and female patients and comparing patients of different ethnicities. For vascular dementia, published papers on life expectancy vary between 3 to 5 years. Vascular dementia appears to have a poorer prognosis than Alzheimer's disease. The stages of severity of dementia were compared in a follow-up of a sample of Alzheimer's disease patients in Singapore, and the mean duration of the mild phase (clinical dementia rating 1) was 5.6 years, the moderate phase (clinical dementia rating 2) was 3.5 years, and the severe phase (clinical dementia rating 3) was 3.2 years. At the various phases of the disease, the demand on health-care services and economic cost are different.