Previous findings of cognitive deficits and EEG slowing in Alheimer’s patients, together with independent reports of the performance enhancing and electrocortical activating properties of nicotine in normal adults, stimulated this study to examine the acute effects of nicotine on spectrum-analyzed EEG in patients with dementia of the Alzheimer type (DAT). Thirteen patients, 6 currently receiving cholinesterase inhibitor treatment and the remaining being medication free, were administered 2 mg of nicotine polacrilex under randomized, placebo-controlled conditions. Compared to age-regressed EEG norms, the pretreatment EEG spectrums of patients in general were characterized by excessive slow (delta and theta)-wave power, diminished fast (alpha and beta)-wave power and slow mean alpha and total band frequencies. Although postnicotine EEG indices remained within the abnormal range, nicotine, compared to placebo, significantly shifted EEG towards normal values by reducing slow wave (relative delta and theta) power and augmenting fast (relative alpha-1, alpha-2, beta-1) wave power. No differences were observed between treated and nontreated patients in response to nicotine. The results are discussed in relation to cholinergic and brain arousal systems and their relationship to cognitive processes.