Objective To investigate the psychometric properties of the Clinical Dementia Scale—frontotemporal lobar degeneration (CDR‐FTLD) psychometric properties using Rasch analysis and its sensitivity distinguishing disease progression between FTLD and Alzheimer's disease (AD). Methods Of 603 consecutive patients from the National Alzheimer Coordinating Center dataset (FTLD = 350; AD = 253), 120 FTLDs were included in a Rasch analysis to verify CDR‐FTLD psychometric properties; 483 (FTLD = 230; AD = 253) were included to analyse disease progression, with 195 (FTLD = 82; AD = 113) followed‐up (24 months). Results The CDR‐FTLD demonstrated good consistency, construct and concurrent validity and correlated well with mini‐mental state examination (MMSE) and disease duration (ps < 0.05). At baseline, FTLD showed greater dementia severity than AD after matched for MMSE and disease duration (p < 0.001). Independent Rasch analyses demonstrated different patterns of progression for FTLD and AD in terms of the domains initially and then subsequently affected with disease progression. At follow‐up, although MMSE showed significant changes (p < 0.05), these were greater on the CDR‐FTLD (p < 0.001). Conclusion The CDR‐FTLD satisfactorily measures dementia severity and change in FTLD, distinguishing disease progression between FTLD and AD, with clear implications for care, prognosis and future clinical trials. © 2016 The Authors. International Journal of Geriatric Psychiatry published by John Wiley & Sons, Ltd.