Amyloid-beta (Abeta) peptides are produced in high amounts during Alzheimer's disease, causing synaptic and memory dysfunction. However, they are also released in lower amounts in normal brains throughout life during synaptic activity. Here we show that low picomolar concentrations of a preparation containing both Abeta(42) monomers and oligomers cause a marked increase of hippocampal long-term potentiation, whereas high nanomolar concentrations lead to the well established reduction of potentiation. Picomolar levels of Abeta(42) also produce a pronounced enhancement of both reference and contextual fear memory. The mechanism of action of picomolar Abeta(42) on both synaptic plasticity and memory involves alpha7-containing nicotinic acetylcholine receptors. These findings strongly support a model for Abeta effects in which low concentrations play a novel positive, modulatory role on neurotransmission and memory, whereas high concentrations play the well known detrimental effect culminating in dementia.