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Results from animal and human studies suggest that lithium in therapeutic doses may improve learning and memory and modify the risk of developing dementia. Additional preliminary studies suggest that subtherapeutic levels, including microlevels of lithium, may influence human cognition.To investigate whether the incidence of dementia in the general population covaries with long-term exposure to microlevels of lithium in drinking water.This Danish nationwide, population-based, nested case-control study examined longitudinal, individual geographic data on municipality of residence and data from drinking water measurements combined with time-specific data from all patients aged 50 to 90 years with a hospital contact with a diagnosis of dementia from January 1, 1970, through December 31, 2013, and 10 age- and sex-matched control individuals from the Danish population. The mean lithium exposure in drinking water since 1986 was estimated for all study individuals. Data analysis was performed from January 1, 1995, through December 31, 2013. A diagnosis of dementia in a hospital inpatient or outpatient contact. Diagnoses of Alzheimer disease and vascular dementia were secondary outcome measures. In primary analyses, distribution of lithium exposure was compared between patients with dementia and controls.A total of 73 731 patients with dementia and 733 653 controls (median age, 80.3 years; interquartile range, 74.9-84.6 years; 44 760 female [60.7%] and 28 971 male [39.3%]) were included in the study. Lithium exposure was statistically significantly different between patients with a diagnosis of dementia (median, 11.5 µg/L; interquartile range, 6.5-14.9 µg/L) and controls (median, 12.2 µg/L; interquartile range, 7.3-16.0 µg/L; P < .001). A nonlinear association was observed. Compared with individuals exposed to 2.0 to 5.0 µg/L, the incidence rate ratio (IRR) of dementia was decreased in those exposed to more than 15.0 µg/L (IRR, 0.83; 95% CI, 0.81-0.85; P < .001) and 10.1 to 15.0 µg/L (IRR, 0.98; 95% CI, 0.96-1.01; P = .17) and increased with 5.1 to 10.0 µg/L (IRR, 1.22; 95% CI, 1.19-1.25; P < .001). Similar patterns were found with Alzheimer disease and vascular dementia as outcomes.Long-term increased lithium exposure in drinking water may be associated with a lower incidence of dementia in a nonlinear way; however, confounding from other factors associated with municipality of residence cannot be excluded.