To verify the hypothesis that borderline diabetes may increase the risk of dementia and Alzheiimer's disease, a community-based cohort of 1,173 dementia- and diabetes-free individuals aged 2:75 years was longitudinally examined three times to detect patients with dementia and Alzheimer's disease (Diagnostic and Statistical Manual of Mental Disorders, Revised Third Edition criteria). Borderline diabetes was defined as a random plasma glucose level of 7.8-11.0 mmol/l. Data were analyzed using Cox proportional hazards models. During the 9-year follow-up, 397 subjects developed dementia, including 307 Alzheimer's cases. At baseline, 47 subjects were identified with borderline diabetes. Borderline diabetes was associated with adjusted hazard ratios (95% CIs) of 1.67 (1.04-2.67) for dementia and 1.77 (1.06-2.97) for Alzheimer's disease; the significant associations were present after additional adjustment for future development of diabetes. Stratified analysis suggested a significant association between borderline diabetes and Alzheimer's disease only among noncarriers of APOE epsilon 4 allele. There was an interaction between borderline diabetes and severe systolic hypertension on the risk of Alzheimer's disease (P = 0.04). We conclude that borderline diabetes is associated with increased risks of dementia and Alzheimer's disease; the risk effect is independent of the future development of diabetes. Borderline diabetes may interact with severe systolic hypertension to multiply the risk of Alzheimer's disease.