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Nanotechnology has emerged in different fields of biomedical application, including lifestyle diseases like diabetes, hypertension, and chronic kidney disease, neurodegenerative diseases like Alzheimer’s disease (AD), Parkinson’s disease, and different types of cancers. Metal nanoparticles are one of the most used drug delivery systems due to the benefits of their enhanced physicochemical properties as compared to bulk metals. Neurodegenerative diseases are the second most cause affecting mortality worldwide after cancer. Hence, they require the most specific and targeted drug delivery systems for maximum therapeutic benefits. Metal nanoparticles are the preferred drug delivery system, possessing greater blood-brain barrier permeability, biocompatibility, and enhanced bioavailability. But some metal nanoparticles exhibit neurotoxic activity owing to their shape, size, surface charge, or surface modification. This review article has discussed the pathophysiology of AD. The neuroprotective mechanism of gold, silver, selenium, ruthenium, cerium oxide, zinc oxide, and iron oxide nanoparticles are discussed. Again, the neurotoxic mechanisms of gold, iron oxide, titanium dioxide, and cobalt oxide are also included. The neuroprotective and neurotoxic effects of nanoparticles targeted for treating AD are discussed elaborately. The review also focusses on the biocompatibility of metal nanoparticles for targeting the brain in treating AD. The clinical trials and the requirement to develop new drug delivery systems are critically analyzed. This review can show a path for the researchers involved in the brain-targeted drug delivery for AD.