Aromatherapy has been used for thousands of years, but it has only recently gained popularity. Aromatherapy has been widely used for dementia but it is also found effective in treating various conditions like, mood disorders, menstrual issues, alopecia and pain. For therapeutic purposes, aromatherapy employs essential oils extracted from plants. The current review discussed the connection between dementia and Alzheimer's disease and also between the olfactory sense and dementia. This review also gives an insight into the mechanism and adverse effects of aromatherapy. Further information has been provided about the common plant essential oils which belongs to different family and it's medicinal use. Even though aromatherapy is considered a promising alternative for many pharmacological medicines, more specific research is needed to understand the pharmacological mechanisms underlying aromatherapy before it can be widely used.