COVID-19 was initially considered a primary respiratory disorder associated with various short- and long-term complications, affecting many patients and imposing a significant burden. Patients who have dementia are especially vulnerable to the SARS-CoV2 infection, which is associated with an increased risk for neuropsychiatric complications. These patients need a unique approach to managing ethical issues related to the COVID-19 pandemic, including autonomy, veracity, non-maleficence, justice, compassion, and dignity. The latter is one of the most elusive and misunderstood concepts in medical ethics and is extremely important in debates surrounding the proper management of patients with dementia. However, it is often left out of ethical analysis, as most clinicians, when debating issues associated with clinical practice, often evaluate only the “classical” principles of biomedical ethics. In this article, we aim to assess the unique features of dignity in treating this group of patients during the COVID-19 pandemic. We will briefly analyze dignity as a bioethical concept. We will further explore its principal axes, namely compassion, creating a humane and purposeful environment, employing persuasion to meet the person’s essential needs, exerting a certain degree of mild restraint to meet the person’s critical needs, minimizing harm in terminal care, and justice, through the lens of people who had dementia during the COVID-19 pandemic. Applying this principle in clinical practice requires significant commitment from all healthcare workers. New approaches to the analysis of dignity, such as through the Ring Theory of Personhood, may facilitate its understanding by practitioners and aid its implementation in populations with multiple vulnerabilities, such as dementia patients, during an infectious outbreak that generates significant social and medical changes.