Abstract: The enigmatic etiology of neurodegenerative diseases poses a challenge for the development of novel and efficient drugs The objective of the present study was to evaluate the efficacy of a polyherbal (test) formulation on cognitive functions, inflammatory markers and oxidative stress in healthy elderly as well as senile dementia of Alzheimer’s type (SDAT) patients A randomized double-blind placebo- and active-controlled clinical trial was performed in healthy elderly subjects and SDAT patients with an age range of 60–75 years The polyherbal test formulation along with a placebo was given to healthy elderly subjects while the SDAT patients received either the test formulation containing extracts of Bacopa monnieri (whole plant), Hippophae rhamnoides (leaves and fruits) and Dioscorea bulbifera (bulbils) at a dose of 500 mg or donepezil drug (Aricept) at a dose of 10 mg, twice daily, for a period of 12 months After every three months, cognitive functions were assessed by determining the mini mental state examination (MMSE) score, digital symbol substitution (DSS; subtest of the Wechsler Adult Intelligence Scale—Revised), immediate and delayed word recall (digital memory apparatus—Medicaid systems, Chandigarh, India), attention span (Attention Span Apparatus—Medicaid systems, Chandigarh, India), functional activity questionnaire (FAQ) and depression (geriatric depression scale) scores Further inflammatory markers and level of oxidative stress were analyzed using standard biochemical tests The trial was performed in 109 healthy subjects and 123 SDAT patients of whom 97 healthy subjects and 104 SDAT patients completed the study Administration of the test formulation for a period of 12 months was effective in improving cognitive functions in the SDAT patients, when compared to the donepezil-treated group, as determined by the DSS (38984 ± 3016 vs 35852 ± 4906, P = 00001), word recall immediate (3594 ± 1003 vs 2794 ± 0593, P < 00001) and attention span (4918 ± 1239 vs 4396 ± 0913, P = 00208) scores A significant improvement in the FAQ (11873 ± 2751 vs 9801 ± 1458, P < 00001) and depression (16387 ± 2116 vs 21006 ± 2778, P < 00001) scores was also observed, whereas no significant differences were observed in the MMSE and word recall delayed scores The level of inflammation and oxidative stress was markedly reduced in the SDAT patients treated with the test formulation when compared to the donepezil-treated group indicating a likely mechanism of action of the test formulation (homocysteine 3022 ± 387 vs 4473 ± 711 nmol/L, P < 00001; C-reactive protein [CRP] 4751 ± 1149 vs 5887 ± 1049 mg/L, P < 00001; tumour necrosis factor alpha [TNF–α] 113945 ± 19887 vs 159877 ± 29852 pg/ml, P < 00001; superoxide dismutase [SOD] 114592 ± 22875 vs 1296 ± 22572 U/g Hb, P = 00013; glutathione peroxidase [GPx] 2078 ± 314 vs 2599 ± 411 U/g Hb, P < 00001; glutathione [GSH] 9358 ± 2139 vs 6831 ± 1139 U/g Hb, P < 00001; thiobarbituric acid reactive substances [TBARS] 13162 ± 2968 vs 17640 ± 6811 nmol/g Hb, P < 00001) Similarly, when healthy elderly subjects treated with the test formulation for 12 months were compared to the placebo group, a significant (P < 0001) improvement in cognitive measures (MMSE, DSS, word recall delayed but not immediate, attention span, FAQ and depression scores) and a reduction in inflammation (reduction in homocysteine, CRP, IL-6 and TNF-α levels) and oxidative stress levels (reduction in SOD, GPx and TBARS and increase in GSH) was observed This indicated a protective effect of the test formulation in managing cognitive decline associated with the ageing process The results of this study demonstrate the therapeutic potential of this novel polyherbal formulation for the management and treatment of SDAT