In Alzheimer's disease (AD), a decline in explicit memory is one of the earliest signs of disease and is associated with hippocampal dysfunction. Amyloid protein exerts a disruptive impact on neuronal function, but the specific effects on hippocampal network activity are not well known. In this study, fast voltage-sensitive dye imaging and extracellular and whole-cell electrophysiology were used on entorhinal cortical-hippocampal slice preparations to characterize hippocampal network activity in 12-16 month old female APPswe/PSEN1DeltaE9 (APdE9 mice) mice. Aged APdE9 mice exhibited profound disruptions in dentate gyrus circuit activation. High frequency stimulation of the perforant pathway in the dentate gyrus (DG) area of APdE9 mouse tissue evoked abnormally large field potential responses corresponding to the wider neural activation maps. Whole-cell patch clamp recordings of the identified inhibitory interneurons in the molecular layer of DG revealed that they fail to reliably fire action potentials. Taken together, abnormal DG excitability and an inhibitory neuron failure to generate action potentials are suggested to be important contributors to the underlying cellular mechanisms of early-stage Alzheimer's disease pathophysiology.