The abnormal deposition of amyloid β (Aβ), produced by proteolytic cleavage events of amyloid precursor protein involving the protease γ-secretase and subsequent polymerization into amyloid plaques, plays a key role in the neuropathology of Alzheimer's disease (AD). Here we show that ErbB3 binding protein 1 (EBP1)/proliferation-associated 2G4 (PA2G4) interacts with presenilin, a catalytic subunit of γ-secretase, inhibiting Aβ production. Mice lacking forebrain Ebp1/Pa2g4 recapitulate the representative phenotypes of late-onset sporadic AD, displaying an age-dependent increase in Aβ deposition, amyloid plaques and cognitive dysfunction. In postmortem brains of patients with AD and 5x-FAD mice, we found that EBP1 is proteolytically cleaved by asparagine endopeptidase at N84 and N204 residues, compromising its inhibitory effect on γ-secretase, increasing Aβ aggregation and neurodegeneration. Accordingly, injection of AAV2-Ebp1 wild-type or an asparagine endopeptidase-uncleavable mutant into the brains of 5x-FAD mice decreased Aβ generation and alleviated the behavioral impairments. Thus, our study suggests that EBP1 acts as an inhibitor of γ-secretase on amyloid precursor protein cleavage and preservation of functional EBP1 could be a therapeutic strategy for AD.