The pathogenesis of Alzheimer's disease (AD) is a critical unsolved question; and although recent studies have demonstrated a strong association between altered brain immune responses and disease progression, the mechanistic cause of neuronal dysfunction and death is unknown. We have previously described the unique CVN-AD mouse model of AD, in which immune-mediated nitric oxide is lowered to mimic human levels, resulting in a mouse model that demonstrates the cardinal features of AD, including amyloid deposition, hyperphosphorylated and aggregated tau, behavioral changes, and age-dependent hippocampal neuronal loss. Using this mouse model, we studied longitudinal changes in brain immunity in relation to neuronal loss and, contrary to the predominant view that AD pathology is driven by proinflammatory factors, we find that the pathology in CVN-AD mice is driven by local immune suppression. Areas of hippocampal neuronal death are associated with the presence of immunosuppressive CD11c+ microglia and extracellular arginase, resulting in arginine catabolism and reduced levels of total brain arginine. Pharmacologic disruption of the arginine utilization pathway by an inhibitor of arginase and ornithine decarboxylase protected the mice from AD-like pathology and significantly decreased CD11c expression. Our findings strongly implicate local immune-mediated amino acid catabolism as a novel and potentially critical mechanism mediating the age-dependent and regional loss of neurons in humans with AD.