The mechanisms that contribute to neuronal degeneration in Alzheimer's disease (AD) are not understood. Abnormal accumulations of beta-amyloid peptide (betaAP) are thought to be involved in the neurodegenerative process, and recent studies have demonstrated neurotoxic actions of betaAPs. We now report that the mechanism of betaAP-mediated neurotoxicity in hippocampal cell culture involves a destabilization of neuronal calcium homeostasis resulting in elevations in intracellular calcium levels ([Ca2+]i) that occur during exposure periods of 6 hr to several days. Both the elevations of [Ca2+]i and neurotoxicity were directly correlated with aggregation of the peptide as assessed by betaAP immunoreactivity and confocal laser scanning microscopy. Exposure of neurons to betaAP resulted in increased sensitivity to the [Ca2+]i-elevating and neurodegenerative effects of excitatory amino acids. Moreover, [Ca2+]i responses to membrane depolarization and calcium ionophore were greatly enhanced in betaAP-treated neurons. Neurons in low cell density cultures were more vulnerable to betaAP toxicity than were neurons in high cell density cultures. Basic fibroblast growth factor (bFGF), but not nerve growth factor (NGF), significantly reduced both the loss of calcium homeostasis and the neuronal damage otherwise caused by betaAP. In AD, betaAP may endanger neurons by destabilizing calcium homeostasis and bFGF may protect neurons by stabilizing intracellular calcium levels. Aggregation of betaAP seems to be a major determinant of its [Ca2+]i-destabilizing and neurotoxic potency.