Background: By 2050, it has been estimated that approximately one-fifth of the population will be made up of older adults (aged ≥60 years). Old age often comes with cognitive decline and dementia. Physical activity may prevent cognitive decline and dementia. Methods: We reviewed and synthesised prospective studies into physical activity and cognitive decline, and physical activity and dementia, published until January 2014. Forty-seven cohorts, derived from two previous systematic reviews and an updated database search, were used in the meta-analyses. Included participants were aged ≥40 years, in good health and/or randomly selected from the community. Studies were assessed for methodological quality. Results: Twenty-one cohorts on physical activity and cognitive decline and twenty-six cohorts on physical activity and dementia were included. Meta-analysis, using the quality-effects model, suggests that participants with higher levels of physical activity, when compared to those with lower levels, are at reduced risk of cognitive decline, RR 0.65, 95% CI 0.55-0.76, and dementia, RR 0.86, 95% CI 0.76-0.97. Sensitivity analyses revealed a more conservative estimate of the impact of physical activity on cognitive decline and dementia for high quality studies, studies reporting effect sizes as ORs, greater number of adjustments (≥10), and longer follow-up time (≥10 years). When one heavily weighted study was excluded, physical activity was associated with an 18% reduction in the risk of dementia (RR 0.82; 0.73-0.91). Conclusions: Longitudinal observational studies show an association between higher levels of physical activity and a reduced risk of cognitive decline and dementia. A case can be made for a causal interpretation. Future research should use objective measures of physical activity, adjust for the full range of confounders and have adequate follow-up length. Ideally, randomised controlled trials will be conducted. Regardless of any effect on cognition, physical activity should be encouraged, as it has been shown to be beneficial on numerous levels.