Risk of dementia increases after stroke, and poststroke dementia (PSD) is an important cause of disability in the elderly. The prevalence rates of PSD vary from 12.2% to 31.8% within 3 months to 1 year after stroke, depending on patient populations and the diagnostic criteria used in the numerous studies. Incidence rates of PSD increase with time after the stroke. Although vascular lesions and white matter changes can explain the cognitive disorders seen in stroke patients, an underlying neurodegenerative disorder may contribute to the development of PSD. Cognitive decline may pre-date the stroke and follow a progressive course after the stroke. The vascular and degenerative processes involved share common environmental and genetic risk factors. This review explains the mechanisms of dementia in stroke patients and identifies predictive factors for PSD. The following points are successively considered: (i) demographic characteristics of the patients, including age and level of education; (ii) prestroke cognitive decline; (iii) vascular risk factors, including diabetes mellitus and prior strokes; (iv) stroke characteristics, including severity and location of the vascular lesion; (v) co-morbid disorders; and (vi) abnormalities on brain imaging, including location, size and number of vascular lesions, white matter changes and cerebral atrophy. Older age, prestroke cognitive decline, stroke recurrence, hypoxic-ischaemic disorders, left-side infarcts, strategic infarcts and white matter lesions appear to be the main predictive factors of PSD. Prevention of stroke should reduce the morbidity and mortality associated with PSD. In addition, management of PSD with secondary prevention treatments could reduce occurrence of further strokes. Cholinesterase inhibitors may be beneficial not only in Alzheimer's disease associated with cerebrovascular lesions, but also for the treatment of cholinergic dysfunction arising from pure vascular dementia. Better knowledge of the risk factors for PSD, including environmental and genetic factors, should increase the effectiveness of preventive strategies in patients with this condition.