Ginkgo biloba extract (EGb 761) can improve cognitive function in patients with Alzheimer's disease, but the molecular mechanisms underlying this effect remain undefined. Because free cholesterol may be involved in the production of beta-amyloid precursor protein and amyloid beta-peptide, key events in the development of Alzheimer's disease, we examined EGb 761 in relation to cholesterol and amyloidogenesis. In aging rats, EGb 761 treatment lowered circulating free cholesterol and inhibited the production of brain beta-amyloid precursor protein and amyloid beta-peptide. Exposure of PC12 cells to EGb 761 decreased the processing of beta-amyloid precursor protein and abolished cholesterol-induced overproduction of this protein. Exposure of human NT2 cells to EGb 761 decreased free cholesterol influx and increased free cholesterol efflux. Our findings indicate that free circulating and intracellular cholesterol levels affect the processing of beta-amyloid precursor protein and amyloidogenesis. Our findings also provide the first demonstration that EGb 761 can influence these mechanisms.