Apolipoprotein E is a plasma cholesterol and phospholipid transporter which plays a central role in lipoprotein metabolism in the brain. Apolipoprotein E is a polymorphic protein with three common alleles in the general population, designated epsilon 2, epsilon 3 and epsilon 4 coding for proteins ApoE2, ApoE3 and ApoE4, respectively. Recent findings have demonstrated a significant relationship between the epsilon 4 allele and late onset familial and sporadic Alzheimer's disease. We examined several classical neuropathological hallmarks of Alzheimer's disease to determine whether they might be related to apolipoprotein E genotype: the presence of intracellular neurofibrillary tangles, extracellular senile plaques, and the attenuation of choline acetyltransferase activity. Significant correlations were found between epsilon 4 allele copy number and senile plaque density in the frontal, parietal and fusiform cortical areas. Similarly, significant correlations were also found with increased neurofibrillary tangle number in the frontal and fusiform cortex. Interestingly, there was an inverse correlation between the epsilon 4 allele with temporal cortical choline acetyltransferase activity. To further define the specific function of ApoE4, cultured rat hippocampal neurons were used to investigate interactions involving beta-amyloid protein. In this model, ApoE4 (but not ApoE2) was able to reverse the neuroprotective effects of beta-amyloid. ApoE3 was demonstrated to increase the internalization of beta-amyloid peptide into these neurons. Taken together, these results support the involvement of ApoE4 in the pathogenesis of Alzheimer's disease and also provide some explanations for the possible function of this protein.