The aspartyl protease beta-site amyloid precursor protein cleaving enzyme 1 (BACE1) initiates processing of amyloid precursor protein (APP) into amyloid beta (Abeta) peptide, the major component of Alzheimer disease (AD) plaques. To determine the role that BACE1 plays in the development of Abeta-driven AD-like pathology, we have crossed PDAPP mice, a transgenic mouse model of AD overexpressing human mutated APP, onto mice with either a homozygous or heterozygous BACE1 gene knockout. Analysis of PDAPP/BACE(-/-) mice demonstrated that BACE1 is absolutely required for both Abeta generation and the development of age-associated plaque pathology. Furthermore, synaptic deficits, a neurodegenerative pathology characteristic of AD, were also reversed in the bigenic mice. To determine the extent of BACE1 reduction required to significantly inhibit pathology, PDAPP mice having a heterozygous BACE1 gene knock-out were evaluated for Abeta generation and for the development of pathology. Although the 50% reduction in BACE1 enzyme levels caused only a 12% decrease in Abeta levels in young mice, it nonetheless resulted in a dramatic reduction in Abeta plaques, neuritic burden, and synaptic deficits in older mice. Quantitative analyses indicate that brain Abeta levels in young APP transgenic mice are not the sole determinant for the changes in plaque pathology mediated by reduced BACE1. These observations demonstrate that partial reductions of BACE1 enzyme activity and concomitant Abeta levels lead to dramatic inhibition of Abeta-driven AD-like pathology, making BACE1 an excellent target for therapeutic intervention in AD.