The incidence of Alzheimer disease (AD) and vascular dementia is greatly increased following cerebral ischemia and stroke in which hypoxic conditions occur in affected brain areas. beta-Amyloid peptide (Abeta), which is derived from the beta-amyloid precursor protein (APP) by sequential proteolytic cleavages from beta-secretase (BACE1) and presenilin-1 (PS1)/gamma-secretase, is widely believed to trigger a cascade of pathological events culminating in AD and vascular dementia. However, a direct molecular link between hypoxic insults and APP processing has yet to be established. Here, we demonstrate that acute hypoxia increases the expression and the enzymatic activity of BACE1 by up-regulating the level of BACE1 mRNA, resulting in increases in the APP C-terminal fragment-beta (betaCTF) and Abeta. Hypoxia has no effect on the level of PS1, APP, and tumor necrosis factor-alpha-converting enzyme (TACE, an enzyme known to cleave APP at the alpha-secretase cleavage site). Sequence analysis, mutagenesis, and gel shift studies revealed binding of HIF-1 to the BACE1 promoter. Overexpression of HIF-1alpha increases BACE1 mRNA and protein level, whereas down-regulation of HIF-1alpha reduced the level of BACE1. Hypoxic treatment fails to further potentiate the stimulatory effect of HIF-1alpha overexpression on BACE1 expression, suggesting that hypoxic induction of BACE1 expression is primarily mediated by HIF-1alpha. Finally, we observed significant reduction in BACE1 protein levels in the hippocampus and the cortex of HIF-1alpha conditional knock-out mice. Our results demonstrate an important role for hypoxia/HIF-1alpha in modulating the amyloidogenic processing of APP and provide a molecular mechanism for increased incidence of AD following cerebral ischemic and stroke injuries.