Dementia is one of the major causes of personal, societal and financial dependence in older people and in today's ageing society there is a pressing need for early and accurate markers of cognitive decline. There are several subtypes of dementia but the four most common are Alzheimer's disease, Lewy body dementia, vascular dementia and frontotemporal dementia. These disorders can only be diagnosed at autopsy, and ante-mortem assessments of "probable dementia (e.g. of Alzheimer type)" are traditionally driven by clinical symptoms of cognitive or behavioural deficits. However, owing to the overlapping nature of symptoms and age of onset, a significant proportion of dementia cases remain incorrectly diagnosed. Misdiagnosis can have an extensive impact, both at the level of the individual, who may not be offered the appropriate treatment, and on a wider scale, by influencing the entry of patients into relevant clinical trials. Magnetic resonance imaging (MRI) may help to improve diagnosis by providing non-invasive and detailed disease-specific markers of cognitive decline. MRI-derived measurements of grey and white matter structural integrity are potential surrogate markers of disease progression, and may also provide valuable diagnostic information. This review summarises the latest evidence on the use of structural and diffusion MRI in differentiating between the four major dementia subtypes.