Alzheimer's disease (AD) is a progressive, neurodegenerative disease characterized by memory and cognitive loss, the formation of senile plaques containing amyloid-beta (Abeta) peptide, degeneration of the cholinergic neurons and the development of neurofibrillary tangles. The build-up of Abeta is considered to be a central feature in the pathogenesis of AD. However, other critical molecular and neurochemical alterations too occur, such as a cholinergic dysfunction. As concerns the pathomechanism of the disease, both the amyloid cascade hypothesis and the cholinergic hypothesis of AD are widely accepted. This review surveys recent in vitro and in vivo experimental evidence relating to these two hypotheses. Bidirectional pathways linking them as regards the cholinergic neurotoxicity of Abeta and the regulatory mechanisms of cholinergic receptor activation or enzyme inhibition in the processing of the amyloid precursor protein are also discussed. Further work is warranted to elucidate the exact effects in the interactions between the cholinergic and amyloid hypotheses of the candidate drugs used in AD therapy.