Amnesia refers to lacking memory. In amnesia, our declarative memory gets affected which is important to retain facts and require conscious effort. There are two types of amnesia.
The first one is called anterograde amnesia which is caused due to a disturbance in the step of encoding and consolidation steps of memory processing due to damage to the prefrontal cortex of the brain or hippocampus and ultimately causes inability to form new memories like or example forgetting what happened hour to hour memories of what just happened!
The second type of amnesia is known as retrograde amnesia and it refers to the inability to recall old memories and they have the tendency to forget important people or moments in life and even creating false memories in life known as confabulations and difficulty in placing time due to problem in the storage and retrieval stages of the memory and causes damage to the cortex.
It can be acute or chronic.