This study examined the cortisol secretion pattern and declarative memory performance of dementia caregivers. An illustrated story paradigm memory task was used to evaluate the effects of emotional arousal on memory and assess the caregivers' cognitive compensation capacity. Younger (n=19) and elderly (n=24) noncaregivers and elderly caregivers (n=14) took part in 2 experiments to elucidate the effects of aging (experiment 1) and chronic stress (experiment 2) on memory performance and cortisol levels. Each group was divided in 2 subgroups: one that was exposed to an emotionally neutral story, and one that was exposed to a similar, but emotionally arousing story. Participants completed a multiple-choice questionnaire in the test session. Salivary cortisol samples were collected at 8:00 AM, 4:00 PM, and 10:00 PM, 1 day after memory testing. Experiment 1 showed that, despite an age-related memory deficit, arousal manipulation produced a similar effect in both age groups. Experiment 2 showed that, in addition to the characteristic memory decline of aging, elderly caregivers did not benefit from emotionally arousing material as their noncaregiver counterparts did. This impairment correlated with elevated nighttime cortisol levels, indicating a potential worsening impact of caregiver burden on age-related cognitive decline.