The capacity of older adults to make health care treatment decisions is often impaired in dementia and has been linked to performance on specific neuropsychological tasks. Within-person across-test neuropsychological performance variability has been shown to predict future dementia. This study examined the relationship of within-person across-test neuropsychological performance variability to treatment decision (consent) capacity in community-dwelling older individuals. Men (N = 79) and women (N = 80) with (N = 83) or without (N = 76) probable mild to moderate dementia completed a neuropsychological test battery and a standardized capacity assessment that evaluates each of the following treatment decisional abilities separately: Understanding, Reasoning, Appreciation, and Expression of Choice. Standard scores were used to compute mean neuropsychological performance and within-person across-test variability. Neuropsychological performance and within-person variability were independently associated with continuous and dichotomous measures of capacity. The results of this study provide support for the emerging view that multiple distinct cognitive abilities are required to support this function, and indicate that the sensitivity and accuracy of consent capacity assessments can be improved by evaluating each of these components separately.