Amyloid-β peptide (Aβ) plays an important role in the pathogenesis of Alzheimer's disease (AD). Aβ is generated by proteolysis of β-amyloid precursor protein (APP) and is cleared by enzyme-mediated degradation and phagocytosis by microglia and astrocytes. Some cytokines, such as TGF-β1, stimulate this phagocytosis. In contrast, cellular upregulation of HSP70 expression provides cytoprotection against Aβ. HSP70 activity in relation to inhibition of Aβ oligomerization and stimulation of Aβ phagocytosis has also been reported. Although these in vitro results suggest that stimulating the expression of HSP70 could prove effective in the treatment of AD, there is a lack of in vivo evidence supporting this notion. In this study, we address this issue, using transgenic mice expressing HSP70 and/or a mutant form of APP (APPsw). Transgenic mice expressing APPsw showed less of an apparent cognitive deficit when they were crossed with transgenic mice expressing HSP70. Transgenic mice expressing HSP70 also displayed lower levels of Aβ, Aβ plaque deposition, and neuronal and synaptic loss than control mice. Immunoblotting experiments and direct measurement of β- and γ-secretase activity suggested that overexpression of HSP70 does not affect the production Aβ. In contrast, HSP70 overexpression did lead to upregulation of the expression of Aβ-degrading enzyme and TGF-β1 both in vivo and in vitro. These results suggest that overexpression of HSP70 in mice suppresses not only the pathological but also the functional phenotypes of AD. This study provides the first in vivo evidence confirming the potential therapeutic benefit of HSP70 for the prevention or treatment of AD.