The principal pathological features of Alzheimer's disease (AD) are extracellular amyloid plaques and intracellular neurofibrillary tangles, the latter composed of the microtubule-binding protein tau assembled into paired helical and straight filaments. Recent studies suggest that these pathological entities may be functionally linked, although the mechanisms by which amyloid deposition promotes pathological tau filament assembly are poorly understood. Here, we report that tau is proteolyzed by multiple caspases at a highly conserved aspartate residue (Asp⁴²¹) in its C terminus in vitro and in neurons treated with amyloid-β (Aβ) (1–42) peptide. Tau is rapidly cleaved at Asp⁴²¹ in Aβ-treated neurons (within 2 h), and its proteolysis appears to precede the nuclear events of apoptosis. We also demonstrate that caspase cleavage of tau generates a truncated protein that lacks its C-terminal 20 amino acids and assembles more rapidly and more extensively into tau filaments in vitro than wild-type tau. Using a monoclonal antibody that specifically recognizes tau truncated at Asp⁴²¹, we show that tau is proteolytically cleaved at this site in the fibrillar pathologies of AD brain. Taken together, our results suggest a novel mechanism linking amyloid deposition and neurofibrillary tangles in AD: Aβ peptides promote pathological tau filament assembly in neurons by triggering caspase cleavage of tau and generating a proteolytic product with enhanced polymerization kinetics.