Alzheimer's disease is characterized by the extracellular deposition of beta-amyloid peptide (Abeta) in cerebral plaques and evidence is accumulating that amyloid is neurotoxic. Abeta is derived from the beta-amyloid precursor protein (APP). Proteolytic processing of APP by the enzyme, beta-secretase, produces the N terminus of Abeta, and releases a secreted ectodomain of APP (beta-s-APP). To develop animal models for measuring beta-secretase activity in specific brain cells in vivo, we have targeted the expression of the full-length human APP to either neurons or astrocytes in transgenic mice using the neuron- specific enolase (NSE) promoter or a modified glial fibrillary acidic protein (GFAP) gene, respectively. The APP cDNAs expressed were mutated (KM to NL at 670/671) to encode amino acid substitutions that enhance amyloidogenic processing in vitro. Western analyses revealed abundant production of beta-s-APP in the brains of NSE-APP mice and enzyme-linked immunosorbent assay analyses showed production of Abeta in fetal primary mixed brain cultures and brain homogenates from these transgenic animals. Because the NSE promoter drives expression primarily in neurons, this provides in vivo evidence that the beta-secretase cleavage necessary for generation of beta-s-APP and Abeta is efficiently performed in neurons. In contrast, only little beta-s-APP was detected in brain homogenates of GFAP-APP mice, indicating that astrocytes show very little beta-secretase activity in vivo. This provides strong in vivo evidence that the major source of Abeta in brain is from neurons and not from astrocytes.