Alzheimer's disease (AD) is a devastating disease characterized by synaptic and neuronal loss in the elderly. Compelling evidence suggests that soluble amyloid-β peptide (Aβ) oligomers induce synaptic loss in AD. Aβ-induced synaptic dysfunction is dependent on overstimulation of N-methyl-D-aspartate receptors (NMDARs) resulting in aberrant activation of redox-mediated events as well as elevation of cytoplasmic Ca2+, which in turn triggers downstream pathways involving phospho-tau (p-tau), caspases, Cdk5/dynamin-related protein 1 (Drp1), calcineurin/PP2B, PP2A, Gsk-3β, Fyn, cofilin, and CaMKII and causes endocytosis of AMPA receptors (AMPARs) as well as NMDARs. Dysfunction in these pathways leads to mitochondrial dysfunction, bioenergetic compromise and consequent synaptic dysfunction and loss, impaired long-term potentiation (LTP), and cognitive decline. Evidence also suggests that Aβ may, at least in part, mediate these events by causing an aberrant rise in extrasynaptic glutamate levels by inhibiting glutamate uptake or triggering glutamate release from glial cells. Consequent extrasynaptic NMDAR (eNMDAR) overstimulation then results in synaptic dysfunction via the aforementioned pathways. Consistent with this model of Aβ-induced synaptic loss, Aβ synaptic toxicity can be partially ameliorated by the NMDAR antagonists (such as memantine and NitroMemantine). PSD-95, an important scaffolding protein that regulates synaptic distribution and activity of both NMDA and AMPA receptors, is also functionally disrupted by Aβ. PSD-95 dysregulation is likely an important intermediate step in the pathological cascade of events caused by Aβ. In summary, Aβ-induced synaptic dysfunction is a complicated process involving multiple pathways, components and biological events, and their underlying mechanisms, albeit as yet incompletely understood, may offer hope for new therapeutic avenues.