SRC‐family kinases (SFKs) have been implicated in Alzheimer's disease (AD), but their mode of action was scarcely understood. Here, we show that LYN plays an essential role in amyloid β (Aβ)‐triggered neurotoxicity and tau hyperphosphorylation by phosphorylating Fcγ receptor IIb2 (FcγRIIb2). We found that enzyme activity of LYN was increased in the brain of AD patients and was promoted in neuronal cells exposed to Aβ 1–42 (Aβ1–42). Knockdown of LYN expression inhibited Aβ1–42‐induced neuronal cell death. Of note, LYN interacted with FcγRIIb2 upon exposure to Aβ1–42 and phosphorylated FcγRIIb2 at Tyr273 within immunoreceptor tyrosine‐based inhibitory motif in neuronal cells. With the use of the structure‐based drug design, we isolated KICG2576, an ATP‐competitive inhibitor of LYN. Determination of cocrystal structure illustrated that KICG2576 bound to the cleft in the LYN kinase domain and inhibited LYN with a half‐maximal inhibitory concentration value of 0.15 µM. KICG2576 inhibited Aβ‐ or FcγRIIb2‐induced cell death, and this effect was better than pyrazolopyrimidine 1, a widely used inhibitor of SFK. Upon exposure to Aβ, KICG2576 blocked the phosphorylation of FcγRIIb2 and translocation of phosphatidylinositol 3,4,5‐trisphosphate 5‐phosphatase 2, a binding protein to the phosphorylated FcγRIIb2, to the plasma membrane, resulting in the inhibition of tau hyperphosphorylation, the downstream event of Aβ1–42‐FcγRIIb2 binding. Furthermore, intracerebroventricular injection of KICG2576 into mice ameliorated Aβ‐induced memory impairment. These results suggest that LYN plays a crucial role in Aβ1–42‐mediated neurotoxicity and tau pathology, providing a therapeutic potential of LYN in AD.—Gwon, Y., Kim, S.‐H., Kim, H. T., Kam, T.‐I., Park, J., Lim, B., Cha, H., Chang, H.‐J., Hong, Y. R., Jung, Y.‐K. Amelioration of amyloid β‐FcγRIIb neurotoxicity and tau pathologies by targeting LYN. FASEB J. 33, 4300–4313 (2019). http://www.fasebj.org