Donepezil (E-2020) is a reversible, noncompetitive, piperidine-type cholinesterase inhibitor. It is selective for acetylcholinesterase rather than butyrylcholinesterase. Donepezil 5 and 10 mg/day significantly improved cognition and global clinical function compared with placebo in well designed short term trials (14 to 30 weeks) in 161 to 818 patients with mild to moderate Alzheimer's disease. Beneficial effects on cognition were observed from week 3 of treatment. Donepezil 10 mg/day significantly delayed the deterioration in activities of daily living (ADL) [by 55 weeks] compared with placebo in a retrospective analysis of 1 trial, and in the largest trial significantly improved patients' abilities to perform complex tasks. However, no significant improvement in function was observed with donepezil 5 mg/day in another trial. In the 2 trials of longest duration donepezil (5 and 10 mg) significantly delayed symptomatic progression of the disease. While there was no evidence for a positive effect of donepezil on patients' quality of life, there are no validated measures of this parameter specific to patients with Alzheimer's disease. Donepezil (5 and 10 mg) significantly reduced caregiver burden. Long term efficacy data suggest that improvements in cognition, global function or ADL are maintained for about 21 to 81 weeks with donepezil (10 mg/day in most patients). Donepezil is generally well tolerated with the majority of adverse events being mild and transient. Predictably, most events were cholinergic in nature and generally related to the gastrointestinal and nervous systems. The incidence of these events was significantly higher with donepezil 10 mg than with placebo in short term clinical trials; however, this may have been due to the 7-day dose increase schedule used in these studies and can be minimised by increasing the dose after a longer (6-week) period. The incidence of serious adverse events was generally similar between donepezil 5 and 10 mg (4 to 10%) and placebo (5 to 9%) in short term trials. 26% of patients receiving donepezil (5 and 10 mg) reported serious events over a 98-week period in a long term trial. Importantly, there was no evidence of hepatotoxicity with this drug. Conclusions. Donepezil (5 and 10 mg) is an agent with a simple once-daily dosage schedule which improves cognition and global clinical function in the short (up to 24 weeks) and long term (up to about 1 year) in patients with mild to moderate Alzheimer's disease. Improvements in ADL were also observed with donepezil 10 mg/day. Adverse events associated with donepezil are mainly cholinergic. Donepezil has been extensively studied and should be considered as a first-line treatment in patients with mild to moderate Alzheimer's disease.