Degeneration of basal forebrain cholinergic neurons (BFCNs) contributes to cognitive dysfunction in Alzheimer's disease (AD) and Down's syndrome (DS). We used Ts65Dn and Ts1Cje mouse models of DS to show that the increased dose of the amyloid precursor protein gene, App, acts to markedly decrease NGF retrograde transport and cause degeneration of BFCNs. NGF transport was also decreased in mice expressing wild-type human APP or a familial AD-linked mutant APP; while significant, the decreases were less marked and there was no evident degeneration of BFCNs. Because of evidence suggesting that the NGF transport defect was intra-axonal, we explored within cholinergic axons the status of early endosomes (EEs). NGF-containing EEs were enlarged in Ts65Dn mice and their App content was increased. Our study thus provides evidence for a pathogenic mechanism for DS in which increased expression of App, in the context of trisomy, causes abnormal transport of NGF and cholinergic neurodegeneration.