Background: Dementia is a neurodegenerative syndrome that can lead to profound psychological and social challenges for people with dementia and their informal caregivers. Previous research has found positive effects of arts‐based interventions for people with dementia and caregivers that have been dyadic in nature and the present article sought to review these findings. Methods: A systematic literature review was conducted to investigate psychosocial outcomes of dyadic arts interventions. PsychINFO, Medline, Web of Science and ASSIA databases (from journal inception to March 2020) were searched as well as Google Scholar and reference lists of relevant studies were searched. Interventions were delivered to people with dementia and their caregivers in community‐based settings across five countries. Findings: Thirteen peer‐reviewed journal articles met the criteria for inclusion in this review, six focusing on performing arts and seven on visual arts. The findings suggested that choral singing and visual arts interventions may have positive effects on psychosocial outcomes for both people with dementia and their informal caregivers. Improved well‐being, quality of life, mood, enhanced identity and decreased social isolation were found in some studies. Importantly, across all studies, participants reported enjoying arts activities. This is the first review to systematically assess dyadic arts activities in a dementia context. These activities offer enjoyable and engaging experiences for many person with dementia and caregivers and were generally found to have positive results but mostly small sample size, lack of control groups and different outcome measures made comparisons challenging. Conclusions: Future research recommendations include further theoretical development, identifying key intervention components, and specifying relevant and measurable theoretically informed outcomes within dyadic interventions for this population.