The beta-amyloid protein (A beta) peptide plays an important role in Alzheimer's disease, but the potential actions of physiologic levels of A beta (225-625 pM) have not been explored. We recently showed that picomolar doses of A beta can stimulate tyrosine phosphorylation of neuronal cells and now show that leads to the activation of the lipid kinase phosphatidylinositol 3-kinase (PI3 kinase). Three independent lines of evidence support the hypothesis that A beta is activating PI3 kinase through a tyrosine kinase-mediated mechanism. Immunoblotting studies show that A beta induces tyrosine phosphorylation of p85 as well as association of the p85 subunit of PI3 kinase with tyrosine-phosphorylated proteins. Studies of membrane proteins show that A beta induces a translocation of p85 to membrane-bound glycoproteins, which are likely to be receptors. Finally, direct studies of PI3 kinase activity in both anti-phosphotyrosine immunocomplexes and wheat germ agglutinin precipitates show that A beta increases formation of the product of PI3 kinase. Wortmannin, a selective inhibitor of PI3 kinase, blocks this A beta-stimulated PI3 kinase activity. Thus, physiologic levels of A beta stimulate tyrosine phosphorylation and PI3 kinase activity.