Increasing evidence suggests that proteins exhibiting "prion-like" behavior cause distinct neurodegenerative diseases, including inherited, sporadic and acquired types. The conversion of cellular prion protein (PrP(C)) to its infectious protease resistant counterpart (PrP(Res)) is the essential feature of prion diseases. However, PrP(C) also performs important functions in transmembrane signaling, especially in neurodegenerative processes. Beta-amyloid (Aβ) synaptotoxicity and cognitive dysfunction in mouse models of Alzheimer disease are mediated by a PrP(C)-dependent pathway. Here we review how this pathway converges with proinflammatory cytokine signaling to activate membrane NADPH oxidase (NOX) and generate reactive oxygen species (ROS) leading to dynamic remodeling of the actin cytoskeleton. The NOX signaling pathway may also be integrated with those of other transmembrane receptors clustered in PrP(C)-enriched membrane domains. Such a signal convergence along the PrP(C)-NOX axis could explain the relevance of PrP(C) in a broad spectrum of neurodegenerative disorders, including neuroinflammatory-mediated alterations in synaptic function following traumatic brain injury. PrP(C) overexpression alone activates NOX and generates a local increase in ROS that initiates cofilin activation and formation of cofilin-saturated actin bundles (rods). Rods sequester cofilin from synaptic regions where it is required for plasticity associated with learning and memory. Rods can also interrupt vesicular transport by occluding the neurite within which they form. Through either or both mechanisms, rods may directly mediate the synaptic dysfunction that accompanies various neurodegenerative disorders.