Background: Perfluorooctane sulfonic acid (PFOS), a widely used industrial chemical, was reported to induce memory and learning process dysfunction. Some studies tried to reveal the mechanisms that mediate these effects, but how they are produced is still unknown. Basal forebrain cholinergic neurons (BFCN) maintain cognitive function and their selective neurodegeneration induces cognitive decline, as observed in Alzheimer’s disease. PFOS was reported to disrupt cholinergic and glutamatergic transmissions and thyroid hormone action, which regulate cognitive processes and maintain BFCN viability. Objective/Methods: To evaluate PFOS neurodegenerative effects on BFCN and the mechanisms that mediate them, SN56 cells (a neuroblastoma cholinergic cell line from the basal forebrain) were treated with PFOS (0.1 µM to 40 µM) with or without thyroxine (T3; 15 nM), MK-801 (20 µM) or acetylcholine (ACh; 10 µM). Results: In the present study, we found that PFOS treatment (1 or 14 days) decreased thyroid receptor α (TRα) activity by decreasing its protein levels and increased T3 metabolism through increased deiodinase 3 (D3) levels. Further, we observed that PFOS treatment disrupted cholinergic transmission by decreasing ACh content through decreased choline acetyltransferase (ChAT) activity and protein levels and through decreasing muscarinic receptor 1 (M1R) binding and protein levels. PFOS also disrupted glutamatergic transmission by decreasing glutamate content through increased glutaminase activity and protein levels and through decreasing N-methyl-D-aspartate receptor subunit 1 (NMDAR1); effects mediated through M1R disruption. All these effects were mediated through decreased T3 activity and T3 supplementation partially restored to the normal state. Conclusions: These findings may assist in understanding how PFOS induces neurodegeneration, and the mechanisms involved, especially in BFCN, to explain the process that could lead to cognitive dysfunction and provide new therapeutic tools to treat and prevent its neurotoxic effects.