Currently there are no approved biomarkers for the pre-symptomatic diagnosis of Alzheimer's disease (AD). Cathepsin-D (Cat-D) is a lysosomal protease that is present at elevated levels in amyloid plaques and neurons in patients with AD and is also elevated in some cancers. We have developed a magnetic resonance imaging (MRI)/fluorescent contrast agent to detect Cat-D enzymatic activity. The purpose of this study was to investigate the cellular and tissue uptake of this MRI/fluorescent contrast agent. The agent consists of an MRI probe [DOTA–caged metal ion (Gd3+ or Tm3+)] and a fluorescent probe coupled to a cell-penetrating-peptide sequence by a Cat-D recognition site. The relaxivity of Gd3+–DOTA–CAT(cleaved) was measured in 10% heat-treated bovine serum albumin (BSA) phantoms to assess contrast efficacy at magnetic fields ranging from 0.24 mT to 9.4 T. In vitro, Tm3+–DOTA–CAT was added to neuronal SN56 cells over-expressing Cat-D and live-cell confocal microscropy was performed at 30 min. Tm3+–DOTA–CAT was also intravenously injected into APP/PS1-dE9 Alzheimer's disease mice (n = 9) and controls (n = 8). Cortical and hippocampal uptake was quantified at 30, 60 and 120 min post-injection using confocal microscopy. The liver and kidneys were also evaluated for contrast agent uptake. The relaxivity of Gd3+–DOTA–CAT(cleaved) was 3.3 (mM s)−1 in 10% BSA at 9.4 T. In vitro, cells over-expressing Cat-D preferentially took up the contrast agent in a concentration-dependent manner. In vivo, the contrast agent effectively crossed the blood–brain barrier and exhibited a distinct time course of uptake and retention in APP/PS1-dE9 transgenic mice compared with age-matched controls. At clinical and high magnetic field strengths, Gd3+–DOTA–CAT produced greater T1 relaxivity than Gd3+–DTPA. Tm3+–DOTA–CAT was taken up in a dose-dependent manner in cells over-expressing Cathepsin-D and was shown to transit the blood–brain barrier in vivo. This strategy may be useful for the in vivo detection of enzyme activity and for the diagnosis of Alzheimer's disease. Copyright © 2012 John Wiley & Sons, Ltd.