The PARO robot, a 2.7kg soft, fluffy baby harp seal, has showed promising results - calming agitated and distressed patients during a small pilot study last year.
Each seal can learn its own name, has unique facial features and can show emotions such as surprise, happiness and anger.
Professor Wendy Moyle from Griffith University says with the number of dementia patients expected to double in the next 20 years, finding new treatments is critical.
June Roberts with 'paro seal'
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Robot companion: Dementia patient June Roberts with a PARO seal at a Pinjarra Hills nursing home in Brisbane.