Cleavage of the amyloid precursor protein (APP) by beta- and gamma-secretases results in generation of the amyloid-beta protein (Abeta), which is characteristically deposited in the brain of Alzheimer's disease patients. Inhibitors of 3-hydroxy-3-methyl-glutaryl (HMG)-CoA reductase (the statins) reduce levels of cholesterol and isoprenoids such as geranylgeranyl pyrophosphate (GGPP). Previous studies have demonstrated that cholesterol increases and statins reduce Abeta levels mostly by regulating beta-secretase activity. In this study, we focused on the role of geranylgeranyl isoprenoids GGPP and geranylgeraniol (GGOH) in regulating Abeta production. Our data show that the inhibition of GGPP synthesis by statins plays an important role in statin-mediated reduction of Abeta secretion. Consistent with this finding, the geranylgeranyl isoprenoids preferentially increase the yield of Abeta of 42 residues (Abeta42) in a dose-dependent manner. Our studies further demonstrated that geranylgeranyl isoprenoids increase the yield of APP-CTFgamma (a.k.a. AICD) as well as Abeta by stimulating gamma-secretase-mediated cleavage of APP-CTFalpha and APP-CTFbeta in vitro. Furthermore, GGOH increases the levels of the active gamma-secretase complex in the detergent-insoluble membrane fraction along with its substrates, APP-CTFalpha and APP-CTFbeta. Our results indicate that geranylgeranyl isoprenoids may be an important physiological facilitator of gamma-secretase activity that can foster production of the pathologically important Abeta42.