According to Australian Broadcasting Corporation (ABC) report, a Sydney-based scientist Michael Valenzuela has said the research is focusing on dogs which are capable of developing the same condition.
Researchers will transplant stem cells created from the skin of a dog's belly into its brain, in the hope memory function will be improved.
"These new cells survive in the brain, they grow into brain cells and they actually form connections with the animal's own brain and improve overall memory function," Valenzuela said.
"So if we're ever going to get to the point of reversing those symptoms and problems we're going to have to somehow replace those lost neurons," he said.
Without a breakthrough, it is estimated nearly one million Australians will have dementia by 2050.
He is presenting the research at a national Alzheimer's Australia conference in Hobart.