Delirium and dementia are highly relevant and closely interconnected conditions in hospitalized older adults, particularly because both are frequent, overlapping, and associated with poor outcomes. Delirium is common in this population, occurring either on admission or during hospitalization, with particularly high rates among postoperative and critically ill patients. Hypoactive delirium is especially important because it is often underrecognized despite being the most frequent subtype and being associated with worse outcomes. At the same time, dementia is highly prevalent among older inpatients and significantly increases susceptibility to delirium, especially when baseline cognitive impairment is not identified at admission. The distinction between these syndromes is clinically essential but often difficult. Delirium is characterized by acute onset, fluctuating course, impaired attention, and altered awareness, whereas dementia involves a gradual and progressive decline in memory and other cognitive domains. However, this distinction becomes more complex in cases of delirium superimposed on dementia, where acute changes may be mistaken for chronic progression. Accurate diagnosis therefore depends on careful bedside assessment, evaluation of attention and fluctuation, medication review, collateral history from caregivers, and the identification of acute medical triggers such as infection, dehydration, hypoxia, and metabolic imbalance. Prevention and early recognition are central to improving outcomes. High-risk patients should be identified early, and multicomponent preventive interventions, routine screening, and medication review should be implemented. Delirium is associated with prolonged hospital stay, higher healthcare costs, falls, mortality, cognitive decline, and institutionalization. Because many of its causes are reversible, timely recognition and management can reduce preventable complications and improve both functional and cognitive prognosis in this vulnerable population.