This paper examined phonological processing as reflected in Mandarin word and non-word repetition. Issues related to dementia effects, age effects, and linguistic variables are discussed. Forty-five speakers of Mandarin Chinese in Taiwan took part in this study. Fourteen seniors with Alzheimer's disease (AD), 14 healthy adults, and 17 healthy seniors individually completed a task of word repetition. Scores of accurate repetition were calculated, and error types as well as error frequency were analysed. Linguistic variables, including lexicality, frequency, non-word, and syllable length, were discussed. Major findings were indicative of a significant dementia effect, in which participants with AD were significantly impaired in repeating words with more syllables, specifically 5-syllable non-words of low frequency. Numerous significant age effects were noted. Theoretical implications and directions for future study are discussed.