Inclusions containing actin-depolymerizing factor (ADF) and cofilin, abundant proteins in adult human brain, are prominent in hippocampal and cortical neurites of the post-mortem brains of Alzheimer's patients, especially in neurites contacting amyloid deposits. The origin and role of these inclusions in neurodegeneration are, however, unknown. Here we show that mediators of neurodegeneration induce the rapid formation of transient or persistent rod-like inclusions containing ADF/cofilin and actin in axons and dendrites of cultured hippocampal neurons. Rods form spontaneously within neurons overexpressing active ADF/cofilin, suggesting that the activation (by dephosphorylation) of ADF/cofilin that occurs in response to neurodegenerative stimuli is sufficient to induce rod formation. Persistent rods that span the diameter of the neurite disrupt microtubules and cause degeneration of the distal neurite without killing the neuron. These findings suggest a common pathway that can lead to loss of synapses.