Importance: Most people with dementia will experience neuropsychiatric symptoms, including psychosis characterized by hallucinations and delusions. Across dementia subtypes, hallucinations and delusions are common, though their prevalence and presentation may vary. These symptoms have been associated with worse outcomes compared with dementia alone, including accelerated functional decline and mortality. Many people with dementia reside in long-term care facilities, and identification and management of hallucinations and delusions in this setting are critical. Observations: For residents in long-term care facilities, the following factors can hinder management of hallucinations and delusions related to dementia: (1) delayed recognition of symptoms; (2) reluctance of staff and family members to acknowledge psychiatric issues; (3) lack of approved pharmacotherapies to treat hallucinations and delusions associated with dementia-related psychosis; and (4) regulatory and institutional guidelines, including the long-term care regulatory guidelines established by the Centers for Medicare and Medicaid Services and the 5-star rating system. Conclusions and Relevance: Barriers to the treatment of hallucinations and delusions in patients with dementia in the long-term care setting are myriad and complex. Early diagnosis of dementia-related psychosis and new treatment options for managing hallucinations and delusions are needed to improve care of this patient population.