In Alzheimer's disease (AD), amyloid plaques within the brain are surrounded by activated glial cells (microglia and astrocytes). The mechanisms of glial activation and its effect on disease progression are not fully understood. Growing evidence suggests that beta-amyloid (Abeta) peptide, a major constituent of the amyloid plaque, is critically involved in the induction of an inflammatory response. The goal of this study was to examine the role of Abeta in the pathogenesis of local inflammation and neuronal cell death. We found increased mRNA levels of inducible nitric oxide synthase (iNOS) and the arginine regenerating enzyme argininosuccinate synthetase (ASS) within cortices of AD patients suggesting high output NO production. In vitro, synthetic Abeta1-42 and to a lesser extent Abeta1-40 induced iNOS and ASS transcription with consecutive NO overproduction in mixed rat neuronal-glial cultures. Furthermore, Abeta-stimulation lead to an increased release of inflammatory cytokines interleukin (IL)-1beta, IL-6 and tumor necrosis factor-alpha. Again, Abeta1-42 had a much more pronounced effect as compared to Abeta1-40. Our data suggest that Abeta1-42 is a key mediator of glial activation and via the induction of inflammatory mediators may be a critical component of the neurodegenerative process in AD.