A central question in Alzheimer's disease research is what role synaptic activity plays in the disease process. Synaptic activity has been shown to induce β-amyloid peptide release into the extracellular space, and extracellular β-amyloid has been shown to be toxic to synapses. We now provide evidence that the well established synaptotoxicity of extracellular β-amyloid requires γ-secretase processing of amyloid precursor protein. Recent evidence supports an important role for intraneuronal β-amyloid in the pathogenesis of Alzheimer's disease. We show that synaptic activity reduces intraneuronal β-amyloid and protects against β-amyloid-related synaptic alterations. We demonstrate that synaptic activity promotes the transport of the amyloid precursor protein to synapses using live cell imaging, and that the protease neprilysin is involved in reduction of intraneuronal β-amyloid with synaptic activity.