Reduced bone mineral density and hip fracture are frequently observed in patients with Alzheimer's disease (AD). However, mechanisms underlying their association remain poorly understood. Amyloid precursor protein (APP) is a transmembrane protein that is ubiquitously expressed in bone marrow stromal cells (BMSCs), osteoblasts (OBs), macrophages (BMMs), and osteoclasts (OCs). Mutations in the APP gene identified in early-onset AD patients are believed to cause AD. But little is known about APP's role in bone remodeling. Here, we present evidence for Swedish mutant APP (APPswe) in suppression of OB differentiation and function in culture and in mouse. APP expression in BMSCs increases during aging. Ubiquitous expression of APPswe in young adult Tg2576 transgenic mice (under the control of a prion promoter) recaptured skeletal “aging-like” deficits, including decreased OB genesis and bone formation, increased adipogenesis and bone marrow fat, and enhanced OC genesis and bone resorption. Remarkably, selective expression of APPswe in mature OB-lineage cells in TgAPPswe-Ocn mice (under the control of osteocalcin [Ocn] promoter-driven Cre) also decreased OB genesis and increased OC formation, resulting in a trabecular bone loss. These results thus suggest a cell-autonomous role for APPswe in suppressing OB formation and function, but a nonautonomous effect on OC genesis. Notably, increased adipogenesis and elevated bone marrow fat were detected in young adult Tg2576 mice, but not in TgAPPswe-Ocn mice, implying that APPswe in BMSCs and/or multicell types in bone marrow promotes bone marrow adipogenesis. Intriguingly, the skeletal aging-like deficits in young adult Tg2576 mice were prevented by treatment with N-acetyl-L-cysteine (NAC), an antioxidant, suggesting that reactive oxygen species (ROS) may underlie APPswe-induced osteoporotic deficits. Taken together, these results demonstrate a role for APPswe in suppressing OB differentiation and bone formation, implicate APPswe as a detrimental factor for AD-associated osteoporotic deficit, and reveal a potential clinical value of NAC in the treatment of osteoporotic deficits. © 2013 American Society for Bone and Mineral Research.