Margaret Mackie, 83, struggles to remember one day to the next with her condition but managed to hit the notes and deliver the words perfectly.
The Linlithgow pensioner wowed staff, residents and her family as they watched her perform the classic track at Northcare Suites Care Home in the city's Telford Road.
Margaret, who has been at the care home since October, delighted the crowd with care home butler Jamie Lee Morley, who said the song was played at his grandfather's funeral last year after he died following a long battle with dementia.
Jamie, 31, said he bonded with Margaret over their shared love for music when he noticed her singing along to Elvis on TV in the lounge, not long after she moved to the home.
He told the Evening News they have been singing together "every day" since and that he often play Elvis on Youtube.
Speaking about the video taken at the Christmas do, he said: "My grandfather past away last year to dementia so it was quite an emotional moment and I'd never sung it before. It was in the front of my mind and I thought I would sing it and get Margaret up to join, and she was totally up for it.
"She was right up there on stage and looked like an absolute diamond.
"She amazes me with her strength of character when she can't remember one day to the next.
"Music takes people back and brings out the best of memories that people lose along the way, and this is proven with Margaret - she just comes alive.
Jamie, who lives in Granton, also brought Davidson Main's children's choir up to the home last Wednesday for the Christmas do, with the kids singing and dancing along with the residents.
He then got up to sing My Way with Margaret - and footage of the moment has since gone viral.
The 31-year-old, who is originally from Manchester but has lived in Edinburgh for 14 years, has been serving food and drink to residents at the home since it opened in September.
He moved there from his old job as a barista and says he has "found his calling" and "absolutely loves older people."
Margaret's daughter, Mairi Hunter, was also in the audience last Wednesday and said the video has been important to show that life isn't over after a dementia diagnosis.
Jamie added: "Her family are bowled over by it. These are memories they can hold on to for the rest of their lives.
"It's just been lovely and it's been such an amazing response online. That's priceless."
Jamie said he will be heading up to Northcare Manor care home in Slateford on Thursday to sing with the children's choir at another Christmas do for residents.