Prion diseases are fatal neurodegenerative disorders characterized by a long pre-symptomatic phase followed by rapid and progressive clinical phase. Although rare in humans, the unconventional infectious nature of the disease raises the potential for an epidemic. Unfortunately, no treatment is currently available. The hallmark event in prion diseases is the accumulation of a misfolded and infectious form of the prion protein (PrP(Sc)). Previous reports have shown that PrP(Sc) induces endoplasmic reticulum stress and changes in calcium homeostasis in the brain of affected individuals. In this study we show that the calcium-dependent phosphatase Calcineurin (CaN) is hyperactivated both in vitro and in vivo as a result of PrP(Sc) formation. CaN activation mediates prion-induced neurodegeneration, suggesting that inhibition of this phosphatase could be a target for therapy. To test this hypothesis, prion infected wild type mice were treated intra-peritoneally with the CaN inhibitor FK506 at the clinical phase of the disease. Treated animals exhibited reduced severity of the clinical abnormalities and increased survival time compared to vehicle treated controls. Treatment also led to a significant increase in the brain levels of the CaN downstream targets pCREB and pBAD, which paralleled the decrease of CaN activity. Importantly, we observed a lower degree of neurodegeneration in animals treated with the drug as revealed by a higher number of neurons and a lower quantity of degenerating nerve cells. These changes were not dependent on PrP(Sc) formation, since the protein accumulated in the brain to the same levels as in the untreated mice. Our findings contribute to an understanding of the mechanism of neurodegeneration in prion diseases and more importantly may provide a novel strategy for therapy that is beneficial at the clinical phase of the disease.