The underlying cause of Alzheimer's disease (AD) is thought to be the beta-amyloid aggregates formed mainly by Abeta1-42 peptide. Protective pentapeptides [e.g., Leu-Pro-Phe-Phe-Asp (LPFFD)] have been shown to prevent neuronal toxicity of Abeta1-42 by arresting and reversing fibril formation. Here we report that an endogenous tetrapeptide, endomorphin-2 (End-2, amino acid sequence YPFF), defends against Abeta1-42 induced neuromodulatory effects at the cellular level. Although End-2 does not interfere with the kinetics of Abeta fibrillogenesis according to transmission electron microscopic studies and quasielastic light scattering measurements, it binds to Abeta1-42 during aggregation, as revealed by tritium-labeled End-2 binding assay and circular dichroism measurements. The tetrapeptide attenuates the inhibitory effect on cellular redox activity of Abeta1-42 in a dose-dependent manner, as measured by 3-(4,5-dimethylthiazolyl-2)-2,-5-diphenyltetrazolium bromide (MTT) assay. In vitro and in vivo electrophysiological experiments show that End-2 also protects against the field excitatory postsynaptic potential attenuating and the NMDA-evoked response-enhancing effect of Abeta1-42. Studies using [D-Ala (2), N-Me-Phe (4), Gly (5)-ol]-enkephalin (DAMGO), a mu-opioid receptor agonist, show that the protective effects of the tetrapeptide are not mu-receptor modulated. The endogenous tetrapeptide End-2 may serve as a lead compound for the drug development in the treatment of AD.