Thalidomide is a tumor necrosis factor alpha (TNFα) inhibitor which has been found to have abilities against tumor growth, angiogenesis and inflammation. Recently, it has been applied in clinic for the treatment of multiple myeloma as well as some inflammatory diseases. However, whether thalidomide has any therapeutic effects on neurodegenerative disorders, i.e. Alzheimer's disease (AD) is not clear. AD is characterized by excessive amount of amyloid β peptides (Aβ), which results in a significant release of inflammatory factors, including TNFα in the brain. Studies have shown that inhibition of TNFα reduces amyloid-associated pathology, prevents neuron loss and improves cognition. Our recent report showed that genetic inhibition of TNFα/TNF receptor signal transduction down-regulates β amyloid cleavage enzyme 1 (BACE1) activity, reduces Aβ generation and improves learning and memory deficits. However, the mechanism of thalidomide involving in the mitigation of AD neuropathological features remains unclear. Here, we chronically administrated thalidomide on human APPswedish mutation transgenic (APP23) mice from 9 months old (an onset of Aβ deposits and early stage of AD-like changes) to 12 months old. We found that, in addition of dramatic decrease in the activation of both astrocytes and microglia, thalidomide significantly reduces Aβ load and plaque formation. Furthermore, we found a significant decrease in BACE1 level and activity with long-term thalidomide application. Interestingly, these findings cannot be observed in the brains of 12-month-old APP23 mice with short-term treatment of thalidomide (3 days). These results suggest that chronic thalidomide administration is an alternative approach for AD prevention and therapeutics.