INTRODUCTION: We aimed to explore the role of a novel traditional herbal compound medicine (HCM) in Alzheimer's disease (AD). MATERIAL AND METHODS: 72 rats were randomized into control, AD, Donepezil and HCM groups. Injection of -amyloid peptide (A1-42) into the lateral ventricle was used to induce AD in rats. Rats in treatment groups received HCM (1.5, 3.0 and 6.0 g/kg) and Donepezil (0.92 mg/kg) for 21 days, respectively. The spatial learning and memory ability were observed by Morris water maze (MWM) test. Haematoxylin-eosin (HE) staining was carried out for pathological morphology. The contents of superoxide dismutase (SOD), catalase (CAT), glutathione peroxidase (GSH-Px) and malondialdehyde (MDA) in the hippocampus were determined using the spectrophotometric method. A expression was measured by immunohistochemistry and Western blotting. RESULTS: Rats in HCM groups spent less time to locate the platform and performed better in spatial learning and memory than the AD group (p < 0.05). Hippocampus in the HCM (6.0 g/kg) group had a complete pyramidal cell layer, in which the structure of morphology was normal and the number of neurons was larger than in the AD group (p < 0.01). The contents of SOD, CAT, GSH-Px were notably increased and MDA content was significantly decreased in the hippocampus in HCM groups than in the AD group (p < 0.01). The expression levels of A1-42 in HCM groups were markedly decreased than in the AD group (p < 0.01). CONCLUSIONS: HCM has a protective effect on the learning and memory capacity in AD in rats, indicating that HCM had cognitive enhancing potentials on AD.