Objectives : This study demonstrates the effects of Daejo-hwan on learning and memory impairment induced by L-NAME (75 mg/kg) treatment and on cerebral ischemic damage induced by middle cerebral artery (MCA) occlusion in rats. Methods : Daejo-hwan emulsion (73.3 mg/100 g/l ml) was administered to rats along a timed study schedule. The Moms water maze was used for learning and memory test of the rats. The MCA was occluded by using the intraluminal thread method. The brain slices were stained by 2 % triphenyl tetrazolium chloride (TTC) and 1 % cresyl violet solution. Infarct size, neuron cell number and size in penumbra was measured by using computer image analysis system. Results : 1. The escape latency of the Daejo-hwan treated group decreased significantly with respect to the control group. 2.The memory score of the Daejo-hwan treated group showed increase tendency, And the swimming distance was not different between the normal, the control, and the Daejo-hwan treated group. 3. The infarct size of the Daejo-hwan treated group decreased significantly with respect to the control group. 4. The total infarct volume of the Daejo-hwan treated group showed decrease tendency. And the brain edema index of the Daejo-hwan treated group decreased significantly with respect to the control group. 5. The neuron cell number and cell size in penumbra of the Daejo-hwan treated group increased significantly with respect to the control group. Conclusions : According to the above results, it is supposed that Daejo-hwan is clinically applicable to the vascular dementia.