Methods: We examined acute dementia care over a 3-year period from 2010 to 2012 in a 600-bed university hospital, to clarify the service activity and costs attributable to acute dementia care. Results: Nine hundred and twenty-nine patients with dementia were admitted during the study period, accounting for 1433/69 718 (2%) of all inpatient episodes, comprising 44 449/454 169 (10%) of total bed days. The average length of stay was 31.0 days in the dementia group and 14.1 days in those > 65 years without dementia. The average hospital care cost was almost three times more (a,not sign13 832) per patient with dementia, compared with (a,not sign5404) non-dementia patients, accounting for 5% (almost a,not sign20 000 000) of the total hospital casemix budget for the period. Discussion: Service activity attributable to dementia care in the acute hospital is considerable. Moreover, given the fact that a significant minority of cognitive impairment goes unrecognized after acute admissions, it is likely that this is under-representative of the full impact of dementia in acute care. Although the money currently being spent on acute dementia care is considerable, it is being used to provide a service that does not meet its user needs adequately. It is clear that acute hospitals need to provide a more 'dementia friendly' service for acutely unwell older persons.