Aims: As the number of older people with dementia increases, safe pharmacotherapy in this population has attracted attention in recent years. The aims of this study were to clarify the prescribing patterns in older patients who were prescribed anti-dementia drugs and to investigate the association of potentially inappropriate medications (PIMs) with the use of anti-dementia drugs. Methods: Adults aged ≥65 years, who were prescribed anti-dementia drugs at 585 pharmacies across Japan (N = 7,953), were surveyed. The percentage of prescriptions of anti-dementia drugs and the effect of those prescriptions on PIMs were investigated. Results: Prescriptions of anti-dementia drugs were found in 4.4% of the entire study population. A multiple logistic regression analysis revealed that the use of anti-dementia drugs reduced the risk of prescribing psychotropic drugs, which represented PIMs, and that a combination of anti-dementia drugs (e.g., cholineesterase inhibitor with memantine) may reduce the risk of prescribing PIMs compared with monotherapy. Conclusion: The use of anti-dementia drugs was associated with fewer prescriptions of drugs considered as PIMs.