The 'Vascular Depression' hypothesis posits that cerebrovascular disease may predispose, precipitate or perpetuate some geriatric depressive syndromes. This hypothesis stimulated much research that has improved our understanding of the complex relationships between late-life depression (LLD), vascular risk factors, and cognition. Succinctly, there are well-established relationships between LLD, vascular risk factors and cerebral hyperintensities, the radiological hallmark of vascular depression. Cognitive dysfunction is common in LLD, particularly executive dysfunction, a finding predictive of poor antidepressant response. Over time, progression of hyperintensities and cognitive deficits predicts a poor course of depression and may reflect underlying worsening of vascular disease. This work laid the foundation for examining the mechanisms by which vascular disease influences brain circuits and influences the development and course of depression. We review data testing the vascular depression hypothesis with a focus on identifying potential underlying vascular mechanisms. We propose a disconnection hypothesis, wherein focal vascular damage and white matter lesion location is a crucial factor, influencing neural connectivity that contributes to clinical symptomatology. We also propose inflammatory and hypoperfusion hypotheses, concepts that link underlying vascular processes with adverse effects on brain function that influence the development of depression. Testing such hypotheses will not only inform the relationship between vascular disease and depression, but also provide guidance on the potential repurposing of pharmacological agents that may improve LLD outcomes.