There is an increasing volume of literature on the positive effects of outdoor natural landscapes on health and well-being. However, to date, there is a paucity of research on the effect of outdoor natural landscapes designed for people with dementia living in long-term care (LTC) facilities, in particular, those which have incorporated the characteristics of a dementia-friendly environment (DFE). This narrative literature review synthesizes current knowledge on the effect of outdoor natural landscape design, which is aligned with the characteristics of a DFE, to improve agitation, apathy and engagement of people with dementia living in LTC facilities. The reviewed studies predominantly support the positive effects of outdoor natural landscapes on agitation, apathy and engagement of people with dementia. However, there are concerns about the methodological approaches, principles incorporated in the applied outdoor natural landscapes' designs, and the environmental assessment. Further rigorous research is required to understand the impact of the outdoor natural landscapes, with the application of DFE characteristics in the design, on agitation, apathy and engagement of people with dementia living in LTC facilities.