Magnetoencephalography (MEG), a direct measure of neuronal activity, is an underexplored tool in the search for biomarkers of Alzheimer’s disease (AD). In this study we used MEG source estimates of auditory gating generators, non-linear correlations with neuropsychological results, and multivariate analyses to examine the sensitivity and specificity of gating topology modulation to detect AD. Our results demonstrated the use of MEG localization of a medial prefrontal (mPFC) gating generator as a discrete (binary) detector of AD at the individual level and resulted in re-categorizing the participant categories in: 1) controls with mPFC generator localized in response to both the standard and deviant tones; 2) a possible preclinical stage of AD participants (a lower functioning group of controls) in which mPFC activation was localized to the deviant tone only; and 3) symptomatic AD in which mPFC activation was not localized to either the deviant or standard tones. This approach showed a large effect size (0.9) and high accuracy, sensitivity and specificity (100%) in identifying symptomatic AD patients within a limited research sample. The present results demonstrate high potential of mPFC activation as a non-invasive biomarker of AD pathology during putative preclinical and clinical stages.