The delusions of this very rare condition may be a sign of the onset of bipolar disorder. One study found a high correlation between bipolar and Cotard's in a group of young people. Cotard's Syndrome has also been associated with schizophrenia, schizoaffective disorder, schizophreniform disorder and dementia. It may also be caused by such things as lesions of the brain.
I found a case study where a woman "was complaining that she was dead, smelled like rotting flesh, and wanted to be taken to a morgue so that she could be with dead people." Another case described the patient as follows: "She said she couldn't think because she had no thoughts. She had no thoughts because she had no brain. She couldn't talk because she had no words. She couldn't eat because she produced no saliva in her mouth."
There is no preferred treatment for Cotard's. Some patients respond to antidepressants, some to antipsychotics, some to mood stabilizers or a mixture of drugs. Other patients do best with electroconvulsive therapy.
Patients with "Walking Corpse" Syndrome can be a danger to themselves, like the woman above who "couldn't eat" and lost 13 pounds in two months. So while the name may sound funny - the condition definitely is not.