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Introduction: There have been recent reports about a decline in dementia incidence, but only little is known about trends in the mortality of patients with dementia. Only the simultaneous analysis of both trends can inform whether the reported decline in dementia has led to a compression of dementia into higher ages., Methods: We used health claims data from the largest public health insurer in Germany over the two time periods 2004/07 and 2007/10. Dementia was defined according to the International Classification of Disease 10th revision (ICD-10) numbers G30, G31.0, G31.82, G23.1, F00, F01, F02, F03 and F05.1 or by a prescription of cholinesterase inhibitors or memantine or both. In the two time periods, we observed 502,065 person-years of exposure and 10,881 incident dementia cases and 10,013 person-years of exposure among the newly demented and 3049 deaths. We estimated the relative risks of the two time periods applying proportional hazard models and calculated years with or without dementia using the illness-death model., Results: Dementia incidence was significantly higher in 2006/07 than in 2009/10, whereas mortality with dementia tended to be lower in the first period, albeit statistically significant among women only. Mortality without dementia tended to be higher in the first period for men and remained stable for women. Combining these trends, we found that at age 65 remaining life years with dementia were compressed by a yearly 0.4 months for men and 1.4 months for women. At the same time, remaining life years without dementia increased by a yearly 1.4 months for men and 1.1 months for women., Conclusions: This study provides evidence that the increase in dementia-free life years went together with an absolute compression of life years with dementia. This positive trend was particularly strong among women. Results were controlled for trends in multi-morbidity and care need, suggesting that the postponement in dementia incidence is not simply caused by a delay in diagnosis.