Unawareness of deficit is a common feature of degenerative dementia. The present study explored awareness and correction of naturalistic action errors in 54 dementia participants and 10 healthy controls while they performed a series of everyday tasks, such as toast preparation and gift-wrapping. Awareness for everyday task performance and cognitive functioning was also assessed with questionnaire discrepancy scores, and a neuropsychological test protocol was administered. Dementia participants were aware of and corrected a significantly smaller proportion of errors compared to controls (z = 4.59, p < 001). Awareness and correction of action errors was not significantly correlated with the number of naturalistic errors committed, questionnaire discrepancy scores, or neuropsychological test data. Within-group analyses showed awareness differed across error types, such that participants were aware of a greater proportion of substitution and sequence errors compared to omissions, perseverations, and action addition (i.e., utilization behavior) errors (z ≤ −3.2,p≤.002 for all analyses). Taken together these data suggest that error awareness and correction during the course of action is not related to error production or awareness measured via questionnaire discrepancy scores. Rather, direct assessment of error detection and correction may provide novel information about behavioral monitoring that can not be extrapolated from measures of dementia severity or traditional neuropsychological assessment.