A multicenter study was conducted to determine the long-term efficacy and safety of olanzapine in the treatment of psychotic symptoms and behavioral disturbances associated with Alzheimer’s disease. Elderly nursing home patients with dementia (mean age: 83.1 years) and meeting the NINCDS-ADRDA criteria for possible or probable Alzheimer’s disease were enrolled in the study. Following a placebo lead-in period and a 6-week double-blind acute phase, 137 patients who successfully completed the acute phase entered an open-label phase of up to 18 weeks during which they received olanzapine in a dose range of 5, 10, or 15 mg/day. Most patients received 5 mg/day of olanzapine for the majority of the time in the open-label period. The mean change from baseline to endpoint in the sum of the Agitation, Delusions, and Hallucinations items of the Neuropsychiatric Inventory—Nursing Home version was used as the primary efficacy measure (NPI/NH Core Total). Secondary measures included the Total and individual item scores of the NPI/NH, including Occupational Disruptiveness, as well as scores on the BPRS and MMSE. Following treatment with olanzapine, patients’ scores were significantly improved on the Core Total (mean ± SD: −7.55 ± 8.53, p < .001), Total (−17.85 ± 23.72, p < .001), and 10 of the 13 individual item scores of the NPI/NH, including Occupational Disruptiveness (−2.84 ± 3.24, p < .001). Similarly, olanzapine-treatment resulted in significant improvements in the BPRS Total (−6.52 ± 12.76, p < .001). MMSE scores and the other NPI/NH individual item scores were not significantly changed from baseline. Barnes Akathisia scores were significantly improved from baseline (−0.22 ± 0.80, p = .002), while Simpson-Angus and AIMS scores were not significantly changed. No significant changes occurred in patient ECGs, including QTc interval, nor in any other vital sign or in weight. Treatment-emergent symptoms included somnolence (26% of patients, 94% mild-to-moderate), accidental injury (25% of patients, 91% mild-to-moderate), and rash (22% of patients, 93% mild-to-moderate). In total, these data suggest that olanzapine is an effective, generally safe, and well-tolerated long-term treatment for control of psychotic symptoms and behavioral disturbances in elderly patients with Alzheimer’s dementia.