We examined the patterns of prescription for antidementia drugs by German physicians with special reference to source of prescription, appropriateness of drugs and dosages and continuity of prescription patterns. The study is based on claims data of all 1848 incident cases in persons aged 65 years and older from a nationwide operating statutory health insurance company in the years 2004–2006. Inclusion criteria were one International Statistical Classification of Diseases and Related Health Problems 10th Revision code for dementia in at least three of four consecutive quarters and four quarters without such a code beforehand. Defined daily doses were used to quantify the prescription size. Data analysis used univariate and multivariate techniques. The majority of incident dementia cases in general and Alzheimer's disease cases in particular did not receive medication in conformity with the guidelines during the year after incidence. Inappropriate prescription was related to not visiting a specialist, living in urban areas, age and comorbidity. Further research is needed both on reasons for nonprescription among professionals and for discontinuation by the patients. In addition, the problems of practicability and implementation of guidelines deserve more attention.