The nature of the relationship between sleep problems and dementia remains unclear. This study investigated the relationship between sleep measures and dementia in older adults (≥ 65) using data from the English Longitudinal Study of Ageing (ELSA) and further investigated the causal association in Mendelian randomization (MR) analysis. In total of 7,223 individuals, 5.7 % developed dementia (1.7 % Alzheimer's disease (AD)) within an average of 8 (± 2.9) years. Cox regression models and MR were employed. Long sleep duration (>8 h) was associated with 64 % increased risk of incident dementia and 2-fold high risk of AD compared to ideal sleep duration (7–8 h). This association was particularly evident in older-older adults (≥70 years) and those who consumed alcohol. Short sleep duration (<7 h) was associated with lower risk of incident dementia among older-older but higher risk among younger-older adults. Sleep disturbances and perceived sleep quality were not associated with dementia or AD. The MR study did not reveal causal associations between sleep duration and dementia. These findings suggest that self-reported short sleep in younger-older and long sleep in older-older adults and those with frequent alcohol consumption are associated with dementia. Early detection of these sleep patterns may help identify individuals at higher dementia risk.