Jackie Powell, Brady's mental health advocate, said his behaviour had become increasingly bizarre and medical experts believed he was now seriously ill.
The revelation has prompted fears that the Scot may become unable to remember where he buried Keith Bennett, the only one of his five young victims whose remains have never been found.
Glasgow-born Brady, 76, was jailed for life in 1966 along with his girlfriend Myra Hindley for abducting, abusing, torturing and killing five youngsters in Manchester before burying them on nearby Saddleworth Moor.
He has been held at Ashworth high-security psychiatric hospital in Liverpool since 1985.
Ms Powell, who has visited Brady regularly since 1999, has reportedly claimed that during a recent meeting with him she saw signs of dementia. She is said to believe he was nearing the end of his life.
But she said Brady wouldn't accept there was anything wrong and refused to undergo tests to could confirm whether he has Alzheimer's disease.
She told a newspaper: "Brady has to be in control and getting dementia is his worst nightmare. No one who meets him could ever deny that he had a very sharp mind. He is highly intelligent and insists on dealing with things on his own terms. He never wants to expose his feelings."