The amyloid-β (Aβ) peptide is contained within the C-terminal fragment (β-CTF) of the amyloid precursor protein (APP) and is intimately linked to Alzheimer's disease. In vivo, Aβ is generated by sequential cleavage of β-CTF within the γ-secretase module. To investigate γ-secretase function, in vitro assays are in widespread use which require a recombinant β-CTF substrate expressed in bacteria and purified from inclusion bodies, termed C100. So far, little is known about the conformation of C100 under different conditions of purification and refolding. Since C100 dimerization influences the efficiency and specificity of γ-secretase cleavage, it is also of great interest to determine the secondary structure and the oligomeric state of the synthetic substrate as well as the binding properties of small molecules named γ-secretase modulators (GSMs) which we could previously show to modulate APP transmembrane sequence interactions [Richter et al. (2010) Proc. Natl. Acad. Sci. U.S.A. 107, 14597-14602]. Here, we use circular dichroism and continuous-wave electron spin resonance measurements to show that C100 purified in a buffer containing SDS at micelle-forming concentrations adopts a highly stable α-helical conformation, in which it shows little tendency to aggregate or to form higher oligomers than dimers. By surface plasmon resonance analysis and molecular modeling we show that the GSM sulindac sulfide binds to C100 and has a preference for C100 dimers.