Background There is limited literature around peer research in dementia. This study aims to identify the benefits, the risks and the practical challenges and to develop a model of good practice in peer research with people with dementia. Methods We searched on PsycInfo, PubMed and Google Scholar for empirical investigations or discussion papers on peer research. Given the limited literature in the field of dementia, we included studies with groups who share similar demographics (older people), experience of stigma (mental health service users) and exclusion from research (people with learning disabilities). We applied no restrictions on language and publication date. Analysis We identified three themes: the potential benefits, the potential risks and the practical challenges of peer research. We developed a model of good practice. The European Working Group of People with Dementia reviewed our paper and added to our findings. Results We included seven papers. Potential benefits of peer research included enriched data and empowering people with dementia. Potential risks included power differentials between researchers and issues of representativeness. The practical issues for good practice included the training of peer researchers, defining involvement and roles, working with cognitive impairment and considering resource implications. The European Working Group of People with Dementia emphasised the importance of equality issues. Conclusion Involving people with dementia in peer research can generate several benefits, including empowerment and opportunities for inclusion for the peer researchers and the research participants living with dementia, challenging academics' traditional views on research processes and gathering enhanced research data. There remains a need for further research on the impact of peer research in dementia studies. Copyright © 2016 John Wiley & Sons, Ltd.