Early events in Alzheimer's disease (AD) pathogenesis implicate the accumulation of -amyloid (A) peptide inside neurons in vulnerable brain regions. However, little is known about the consequences of intraneuronal A on signaling mechanisms. Here, we demonstrate, using an inducible viral vector system to drive intracellular expression of A42 peptide in primary neuronal cultures, that this accumulation results in the inhibition of the Akt survival signaling pathway. Induction of intraneuronal A42 expression leads to a sequential decrease in levels of phospho-Akt, increase in activation of glycogen synthase kinase-3, and apoptosis. Downregulation of Akt also paralleled intracellular A accumulation in vivo in the Tg2576 AD mouse model. Overexpression of constitutively active Akt reversed the toxic effects of A through a mechanism involving the induction of heat shock proteins (Hsps). We used a small-interfering RNA approach to explore the possibility of a link between Akt activity and Hsp70 expression and concluded that neuroprotection by Akt could be mediated through downstream induction of Hsp70 expression. These results suggest that the early dysfunction associated with intraneuronal A accumulation in AD involve the associated impairments of Akt signaling and suppression of the stress response.