Protein phosphatase inhibitors, okadaic acid and Caliculin A, were used to investigate how perturbation of phosphorylation and dephosphorylation processes might affect neurite and synapse structure in cultures of fetal rat hippocampal neurons. Drug treatments induced neuritic tree modification, with retraction of the processes and the appearance of dilatations along the neurites. The characteristic dotlike pattern of immunoreactivity of synaptic vesicle proteins disappeared. Normal synapses were extremely rare by ultrastructural observation. Vesicles of various diameters accumulated in the dilatations, as did organelles and amorphous material, suggesting impaired axonal transport. Hyperphosphorylation of tau protein was also observed as indicated by the shift in the electrophoretic mobility of a 32P-labeled 55-kDa band and by immunoblot with epitope-specific tau antibody. Our results show that inhibition of protein phosphatases 1 and 2A results in a modification of the neuritic tree structure, with loss of neuronal processes, phosphorylation of a tau isoform, and a decrease in the number of synapses. These neuronal features are present in Alzheimer's disease (AD). Our results suggest that the two events might be related and provide a potential link between the biochemical hallmark of AD (hyperphosphorylation of tau) and a pathological finding of primary clinical relevance (the synaptic loss).