The researchers, who followed nearly 2m people in Canada over 11 years, say air pollution or noisy traffic could be contributing to the brain's decline. UK dementia experts said the findings needed probing but were "plausible". Nearly 50 million people around the world have dementia. However, the causes of the disease, that robs people of their memories and brain power, are not understood.
The study in the Lancet followed nearly two million people in the Canadian province of Ontario, between 2001 and 2012.
There were 243,611 cases of dementia diagnosed during that time, but the risk was greatest in those living closest to major roads.
Compared with those living 300m away from a major road the risk was:
7% higher within 50m
4% higher between 50-100m
2% higher between 101-200m
The analysis suggests 7-11% of dementia cases within 50m of a major road could be caused by traffic.
The researchers adjusted the data to account for other risk factors like poverty, obesity, education levels and smoking so these are unlikely to explain the link.
Dr Hong Chen, from Public Health Ontario and one of the report authors, said: "Increasing population growth and urbanisation have placed many people close to heavy traffic, and with widespread exposure to traffic and growing rates of dementia, even a modest effect from near-road exposure could pose a large public health burden.
"More research to understand this link is needed, particularly into the effects of different aspects of traffic, such as air pollutants and noise." BBC