Alzheimer’s disease, the most common neurodegenerative disorder of senile dementia, is characterized by two major morpho-pathological hallmarks. Deposition of extracellular neuritic, β-amyloid peptide-containing plaques (senile plaques) in cerebral cortical regions of Alzheimer patients is accompanied by the presence of intracellular neurofibrillary tangles in cerebral pyramidal neurons. Basal forebrain cholinergic dysfunction is also a consistent feature of Alzheimer’s disease, which has been suggested to cause, at least partly, the cognitive deficits observed in patients with Alzheimer’s disease. Impaired cortical cholinergic neurotransmission may also contribute to β-amyloid plaque pathology in Alzheimer’s disease by affecting expression and processing of the β-amyloid precursor protein (APP). Vice versa, low level of soluble β-amyloid has been observed to inhibit cholinergic synaptic function. Deposition of β-amyloid plaques in Alzheimer’s disease is also accompanied by a significant plaque-associated glial up-regulation of interleukin-1, which has been attributed to affect expression and metabolism of APP and to interfere with cholinergic transmission. Understanding the molecular mechanisms underlying the interrelationship between cortical cholinergic dysfunction, β-amyloid formation and deposition, as well as local inflammatory upregulation, would allow to derive potential treatment strategies to pharmacologically intervene in the disease-causing signaling cascade.