Dementia is a major public health problem. Alzheimer’s disease (AD) accounts for 60% of dementia cases. However, AD is currently considered as an incurable disorder and the only few drugs available for its treatment are mostly symptomatic. In the quest for novel drugs for this devastating disease, cannabidiol (CBD) has been recently gaining attention due to its multiple properties, such as an ability to interact with various receptors, anti-inflammatory and antioxidative effects and many more. The aim of this review article was to summarize findings on the effect of CBD on AD with a focus on molecular mechanisms of CBD’s action and therapeutic effects which it exerts.