Amyloid-β peptide (Aβ) is considered a key protein in the pathogenesis of Alzheimer's disease (AD) because of its neurotoxicity and capacity to form characteristic insoluble deposits known as senile plaques. Aβ derives from amyloid-β protein precursor (AβPP), whose proteolytic processing generates several fragments including Aβ peptides of various lengths. The normal function of AβPP and its fragments remains poorly understood. While some fragments have been suggested to have a function in normal physiological cellular processes, Aβ has been widely considered as a “garbage” fragment that becomes toxic when it accumulates in the brain, resulting in impaired synaptic function and memory. Aβ is produced and released physiologically in the healthy brain during neuronal activity. In the last 10 years, we have been investigating whether Aβ plays a physiological role in the brain. We first demonstrated that picomolar concentrations of a human Aβ₄₂ preparation enhanced synaptic plasticity and memory in mice. Next, we investigated the role of endogenous Aβ in healthy murine brains and found that treatment with a specific antirodent Aβ antibody and an siRNA against murine AβPP impaired synaptic plasticity and memory. The concurrent addition of human Aβ₄₂ rescued these deficits, suggesting that in the healthy brain, physiological Aβ concentrations are necessary for normal synaptic plasticity and memory to occur. Furthermore, the effect of both exogenous and endogenous Aβ was seen to be mediated by modulation of neurotransmitter release and α7-nicotinic receptors. These findings need to be taken into consideration when designing novel therapeutic strategies for AD.