Although it has been well-recognized that microcystin-leucine-arginine (MCLR), the most common form of microcystins, induces neurotoxicity, little is currently known about the underlying mechanism for this neurotoxicity. Here, we found that MCLR (10 ng/μL/mouse, i.c.v.) induces significant neuronal loss in the hippocampus of mice. MCLR-induced neurotoxicity was accompanied by oxidative stress, as shown by a significant increase in the level of 4-hydroxynonenal, protein carbonyl, and reactive oxygen species (ROS). Superoxide dismutase-1 (SOD-1) activity was significantly increased, but glutathione peroxidase (GPx) level was significantly decreased following MCLR insult. In addition, MCLR significantly inhibited GSH/GSSG ratio, and significantly induced NFκB DNA binding activity. Because reduced activity of GPx appeared to be critical for the imbalance between activities of SODs and GPx, we utilized GPx-1 overexpressing transgenic mice to ascertain the role of GPx-1 in this neurotoxicity. Genetic overexpression of GPx-1 or NFκB inhibitor pyrrolidine dithiocarbamate (PDTC) significantly attenuated MCLR-induced hippocampal neuronal loss in mice. However, PDTC did not exert any additive effect on neuroprotection mediated by GPx-1 overexpression, indicating that NFκB is a neurotoxic target of MCLR. Combined, these results suggest that MCLR-induced neurotoxicity requires oxidative stress associated with failure in compensatory induction of GPx, possibly through activation of the transcription factor NFκB.