Alzheimer's disease (AD) is the major cause of dementia in the United States. At the cellular level, the brains of AD patients are characterized by extracellular dense plaques and intracellular neurofibrillary tangles whose major components are the beta-amyloid peptide and tau, respectively. The beta-amyloid peptide is a cleavage product of the amyloid precursor protein (APP); mutations in APP have been correlated with a small number of cases of familial Alzheimer's disease. APP is the canonical member of the APP family, whose functions remain unclear. The nematode Caenorhabditis elegans, one of the premier genetic workhorses, is being used in a variety of ways to address the functions of APP and determine how the beta-amyloid peptide and tau can induce toxicity. First, the function of the C. elegans APP-related gene, apl-1, is being examined. Although different organisms may use APP and related proteins, such as APL-1, in different functional contexts, the pathways in which they function and the molecules with which they interact are usually conserved. Second, components of the gamma-secretase complex and their respective functions are being revealed through genetic analyses in C. elegans. Third, to address questions of toxicity, onset of degeneration, and protective mechanisms, different human beta-amyloid peptide and tau variants are being introduced into C. elegans and the resultant transgenic lines examined. Here, we summarize how a simple system such as C. elegans can be used as a model to understand APP function and suppression of beta-amyloid peptide and tau toxicity in higher organisms.