Cognitive stimulation approaches can improve cognition and quality of life for people with dementia but little is known about whether cognitive stimulation interventions led by carers are effective. This study used qualitative methods, professional expert feedback and a field-testing study to develop a home-based individual cognitive stimulation therapy (iCST) programme for people with dementia using the established group cognitive stimulation therapy approach. The carer-led intervention was tested using a randomised controlled trial design to evaluate whether iCST benefits cognition and quality of life for people with dementia, and mental and physical health for carers. We followed participants for 13 weeks and 26 weeks. People with dementia receiving iCST did not benefit in terms of cognition at either time point. There was no evidence that iCST improved quality of life for people with dementia or carers’ mental or physical health. People with dementia engaging in iCST reported a better relationship quality with their family carer at 26 weeks. Carers taking part in iCST with their relative experienced better health-related quality of life at 26 weeks. Despite evidence of improvements in the caregiving relationship for people with dementia and health-related quality of life for carers, this study provides no evidence that carer-led cognitive stimulation interventions help cognition or quality of life for people with dementia. Further research is needed to evaluate the impact of carer-led cognitive-based interventions for people with dementia.