Gradual changes in steady-state levels of beta amyloid peptides (Abeta) in brain are considered an initial step in the amyloid cascade hypothesis of Alzheimer's disease. Abeta is a product of the secretase cleavage of amyloid precursor protein (APP). There is evidence that the membrane lipid environment may modulate secretase activity and alters its function. Cleavage of APP strongly depends on membrane properties. Since Abeta perturbs cell membrane fluidity, the cell membrane may be the location where the neurotoxic cascade of Abeta is initiated. Therefore, we tested effects of oligomeric Abeta on membrane fluidity of whole living cells, the impact of exogenous and cellular Abeta on the processing of APP and the role of GM-1 ganglioside. We present evidence that oligoAbeta((1-40)) stimulates the amyloidogenic processing of APP by reducing membrane fluidity and complexing with GM-1 ganglioside. This dynamic action of Abeta may start a vicious circle, where endogenous Abeta stimulates its own production. Based on our novel findings, we propose that oligoAbeta((1-40)) accelerates the proteolytic cleavage of APP by decreasing membrane fluidity.