Diminished cholinergic function has long been implicated in the pathophysiology of Alzheimer type dementia. Studies in animal models of this disorder as well as in patients with Alzheimer's disease (AD) suggest that drugs capable of activating central cholinergic transmission can improve cognitive function. Nevertheless, no currently available drug of this or any other type consistently confers clinically significant benefit. To further evaluate the cholinergic hypothesis for symptom palliation with a mechanistically novel pharmacologic tool, the acute safety and antidementia efficacy of nefiracetam will be studied using a double-blind, placebo-controlled, parallel groups design. In contrast to the currently available cholinesterase inhibitors, nefiracetam enhances the activity of nicotinic acetylcholine receptors by interacting with a protein kinase C pathway and accelerates acetylcholine turnover and release. Efficacy in patients with mild to moderate dementia will be assessed through application of standardized neuropsychological test instruments in this first double-blind, randomized controlled trial of nefiracetam in AD. Safety will be monitored by means of frequent clinical evaluations and laboratory tests.