This study was conducted to evaluate the effect of PTSD on memory function and hippocampal volume, and to identify major variables correlated to hippocampal volume and memory function. Thirty four Vietnam veterans were collected for this study, among whom eighteen were PTSD patients and sixteen were combat control subjects. The author used Impact of Event Scale(IES), Combat Exposure Scale(CES), Hamilton Depression Rating Scale(HDRS) and Beck Depression Inventory (BDI). Korea Memory Assessment Scale(K-MAS) was assessed for memory function. Magnetic resonance imaging(MRI) was used to measure hippocampal volume. There were significant differences between PTSD and Non-PTSD veterans in IES, HDRS and BDI. Significant difference was found in verbal memory and total memory of K-MAS between PTSD and Non-PTSD veterans. There was significant difference in hippocampal volume between PTSD and Non-PTSD veterans. Short term memory, verbal memory and total memory were positively correlated to hippocampal volume. Hippocampal volume was negatively correlated to IES, HDRS, and BDI. These results suggest that PTSD severity be associated with hippocampal atrophy and memory dysfunction. Reduced or smaller hippocampal volume may be preexisting risk factor for stress exposure or the development of PTSD on combat exposure.