Positive predictive value (PPV) estimates how often a particular test predicts the eventual diagnosis, and it is the basis of any test that attempts to establish a diagnosis. Calculating the PPV depends directly on the entrance criteria for considering the diagnosis and the exit criteria of the generally accepted "gold standard" for establishing the ultimate diagnosis. For a relatively common disease such as AD, the practical usefulness of a diagnostic test also relates to the stage of the disease at which the test can be applied. An accurate and predictive test only has practical value when it can be used early in the course of the disease. Apolipoprotein E (Apo E) is the first genetic locus identified as a susceptibility polymorphism for a common complex disease using positional or candidate cloning strategies. There are three common alleles (epsilon 2 to epsilon 4) and six possible genotypes; about 30% of the population carries an epsilon 4 allele, each additional copy of which is associated with an increased risk of AD and earlier age of onset distribution. In patients with cognitive impairment of the Alzheimer type, who have been diagnosed with possible or probable AD, the presence of an Apo E-epsilon 4 allele is likely in more than 50% of patients for whom the PPV is greater than 97%. Apo E genotyping is the only diagnostic adjunct that has been subjected to rigorous measurements of specificity, sensitivity, PPV, and NPV. In the past, testing of dementia patients was directed at "ruling out" other treatable causes. Results from the initial studies of the PPV of Apo E genotyping for AD showed that the PPV of Apo E genotyping was greater than 97%. The paradigm for AD diagnosis is changing. Apo E genotyping can provide useful diagnostic information and that accuracy will improve as other susceptibility genetic risk factors are identified.