Maintenance of an adequate supply of cholesterol is important for neuronal function, whereas excess cholesterol promotes amyloid precursor protein (APP) cleavage generating toxic amyloid-beta (A-beta) peptides. To gain insights into the pathways that regulate neuronal cholesterol level, we investigated the potential for reconstituted apolipoprotein-E (apoE) discs, resembling nascent lipoprotein complexes in the central nervous system, to stimulate neuronal [3H]-cholesterol efflux. The apoE discs potently accelerated cholesterol efflux from primary human neurons and cell lines. The process was saturable (17.5 mg apoE/ml) and was not influenced by APOE genotype. HPLC analysis of cholesterol and cholesterol metabolites effluxed from neurons indicated that < 25% of the released cholesterol was modified to polar products (eg 24-hydroxycholesterol) that diffuse from neuronal membranes. Thus, most cholesterol (∼75%) appeared to be effluxed from neurons in a native state by means of a transporter pathway. ATP-binding cassette transporters ABCA1, ABCA2 and ABCG1 were detected in neurons and neuroblastoma cell lines and transient and stable expression of these complementary DNAs showed that ABCG1 preferentially stimulated cholesterol efflux to apoE discs. In addition, ABCG1 expression in CHO cells that stably express human APP resulted in ∼60% reduction in A-beta generation. ABCA1 also stimulated cholesterol efflux to apoE discs and inhibited A-beta generation, although both to a lesser degree than ABCG1, whereas ABCA2 did not modulate either of these processes. These data indicate that ABCG1 and ABCA1 play a significant role in the regulation of neuronal cholesterol efflux to apoE discs and in suppression of APP processing to generate A-beta peptides.