We have previously shown that apolipoprotein E (Apoe) promotes the formation of amyloid in brain and that astrocyte-specific expression of APOE markedly affects the deposition of amyloid-β peptides (Aβ) in a mouse model of Alzheimer disease. Given the capacity of astrocytes to degrade Aβ, we investigated the potential role of Apoe in this astrocyte-mediated degradation. In contrast to cultured adult wild-type mouse astrocytes, adult Apoe^−/− astrocytes do not degrade Aβ present in Aβ plaque–bearing brain sections in vitro. Coincubation with antibodies to either Apoe or Aβ, or with RAP, an antagonist of the low-density lipoprotein receptor family, effectively blocks Aβ degradation by astrocytes. Phase-contrast and confocal microscopy show that Apoe^−/− astrocytes do not respond to or internalize Aβ deposits to the same extent as do wild-type astrocytes. Thus, Apoe seems to be important in the degradation and clearance of deposited Aβ species by astrocytes, a process that may be impaired in Alzheimer disease.