Background: Major surgery is frequently associated with postoperative cognitive dysfunction (POCD) in elderly patients. Type of surgery and hospitalization may be important prognostic factors. The aims of the study were to find the incidence and risk factors for POCD in elderly patients undergoing minor surgery. Methods: We enrolled 372 patients aged greater than 60 years scheduled for minor surgery under general anesthesia. According to local practice, patients were allocated to either in- (199) or out-patient (173) care. Cognitive function was assessed using neuropsychological testing preoperatively and 7 days and 3 months postoperatively. Postoperative cognitive dysfunction was defined using Z-score analysis. Results: At 7 days, the incidence (confidence interval) of POCD in patients undergoing minor surgery was 6.8% (4.3-10.1). At 3 months the incidence of POCD was 6.6% (4.1-10.0). Logistic regression analysis identified the following significant risk factors: age greater than 70 years (odds ratio [OR]: 3.8 [1.7-8.7], P=0.01) and in- vs. out-patient surgery (OR: 2.8 [1.2-6.3], P=0.04). Conclusions: Our finding of less cognitive dysfunction in the first postoperative week in elderly patients undergoing minor surgery on an out-patient basis supports a strategy of avoiding hospitalization of older patients when possible.