Experts have predicted that 1.7m people will have dementia by 2051.
There are currently 700,000 people in the UK with dementia, that is one in every 88 people.
By 2021, the figure is expected to rise to 940,110, before reaching 1,735,087 in 2051.
The predicted figure means dementia will affect the lives of around one in three people either as a sufferer, or as a carer or relative, and it is a rise of 154% from the present day.
There is no cure for dementia, and those with the condition need increasing care as the disease progresses so the costs for looking after people with dementia could cost billions each year.
The expected rise is due to the UK's aging population, as well as conditions such as high cholesterol and blood pressure, and lack of exercise which are all thought to increase the risk. Currently one in 20 people over 65, and one in five over 80 have a form of dementia, with two thirds of those affected having Alzheimer's disease.
The research by the London School of Economics and Institute of Psychiatry said that caring for one person with late-onset dementia costs an average of 25,472 pounds per year. At the present time, the bulk of this cost is met by the person with dementia and their families. The researchers found that there were "marked variations" in the levels of provision and spending across the UK, and that care and support is "delivered piecemeal and in an inefficient fashion."
Professor Martin Knapp, of the London School of Economics, one of the report's authors, said: "This research highlights the desperate need for dementia to be made a national priority. Current levels of services and support for people with dementia and carers are clearly inadequate. Dementia is one of the main causes of disability later in life ahead of cancer, cardiovascular disease and stroke, yet funding for dementia research is significantly lower than these other conditions. Even delaying the onset of dementia by five years would halve the number of related deaths, saving nearly 30,000 lives annually."
Neil Hunt, chief executive of the Alzheimer's Society, added: "With every second ticking by, dementia costs the UK 539 pounds. We can't afford to ignore the true cost of dementia to society as a whole. We must tackle this huge challenge head on. We need to invest in dementia services, research, support and training and use what money is being spent more effectively. Planning now will save lives and money in the future. This new research shows that the government is failing to support people with dementia and their carers. Dementia will place an intolerable strain on our health and social care system unless the right services and support are in place."
The government welcomed the research and said that dementia care was already a priority.
Health Secretary Patricia Hewitt said: "We've already doubled the research that we're doing on Alzheimer's and just last week, we announced a new investment, for instance, in emergency respite care for carers of people with dementia, which is one of the things that carers particularly told us it was their top priority."