Cognitive ability of minor depressed patients (N=28), major depressed patients (N=26) and healthy elderly (N=38) was examined cross-sectionally to determine if cognitive abilities of patients with late-onset depression decrease with increasing severity of disease and if cognitive scores for minor depressed patients fall between those of healthy elderly and major depressed patients. A pooled within-group principal component analysis of cognitive test scores identified five components, three of which showed significant group differences. Verbal Recall and Maintenance of Set separated controls from major depressed patients and minor from major depressed patients. Executive Functioning separated controls from minor depressed patients, and Working Memory was borderline for separating controls from major depressed patients. The component representing Nonverbal Recognition was not statistically significant. Partial correlations controlling for age and education indicate that cognitive performance does decrease as severity of depression increases, and the magnitude of the change varies from a trend to a significant deficit depending on the cognitive domain. This decline in cognitive performance parallels a similar trend observed in neuroanatomical studies in which the volume of the frontal and temporal lobes decrease with increasing severity of depression.