Amyloid beta (Aβ)42 plays a pivotal role in Alzheimer's disease. We previously reported a novel presenilin (PS)1 mutant (V97L) that was expressed in related patients with early onset Alzheimer's disease. We found that patients with the V97L mutation had increased levels of extracellular and intracellular Aβ42. Here we found that the increased extracellular level of Aβ42 was always accompanied by a reduction of insulin-degrading enzyme (IDE) activity on the plasma membranes. However, increase of intracellular Aβ42 was associated with decreased expression and activity of IDE in the cytosol and endoplasmic reticulum in the PS1 V97L mutant-transfected human SH-SY5Y cell line. These studies indicate that pathological levels of Aβ42 may be caused by the negative effects of PS1 (V97L) on IDE expression and activity. Our findings provide evidence for the molecular basis of familial Alzheimer's disease pathogenesis.