Long-term treatment with nonsteroidal anti-inflammatory drugs (NSAIDs) reduces the risk for Alzheimer's disease (AD). To determine the mechanisms by which inflammation affects AD and how NSAIDs protect against it, we stimulated neuroblastoma cells stably transfected with amyloid precursor protein (APP) with proinflammatory cytokines, which increased the secretion of amyloid-beta and APP ectodomain. Addition of ibuprofen, indomethacin, peroxisome proliferator-activated receptor-gamma (PPARgamma) agonists, or cotransfection with PPARgamma cDNA reversed this effect. The inhibitory action of ibuprofen and indomethacin was suppressed by PPARgamma antagonists. Finally, we observed that the mRNA levels, expression, and enzymatic activity of beta-secretase were increased by immunostimulation and normalized by NSAIDs. In conclusion, proinflammatory cytokines activate beta-secretase, and NSAIDs inhibit this effect through PPARgamma.