My mother has dementia and some times talks to herself, then believes this is really happening. Any advice?

Yes, this is normal. My Mom saw a little girl all the time. Even called me down to her room to tell her to stop what she was doing. When I got there the little girl had left. Her dreams, TV and reality were one and the same. Like Jeanne said, do the illusions upset her? If not, don't worry if they do talk to her doctor about them. There are medications. Along with seeing things comes paranoia. Mom felt my brother and I were trying to make her think she was crazy.

She's having delusions? That is fairly common in some types of dementia. Does this upset her, or does she take it in stride?