Abnormal production and accumulation of amyloid-beta peptide (Abeta) plays a major role in the pathogenesis of Alzheimer's disease (AD). beta-secretase (BACE1) is responsible for the cleavage at thebeta-site in amyloid beta protein precursor (AbetaPP/APP) to generate the N-terminus of Abeta. Here we report the stepwise identification and characterization of a novel APP-beta-site mutant, "NFEV" (APP_NFEV) in vitro and in cells. In vitro, the APP_NFEV exhibits 100-fold enhanced cleavage rate relative to the "wild-type" substrate (APPwt) and 10-fold increase relative to the Swedish-type mutation variant (APPsw). In cells, it was preferably cleaved among 24 APP beta-site mutations tested. More importantly, the APP_NFEV mutant failed to generate any detectable Abeta peptides in BACE1-KO mouse fibroblast cells. The production of Abeta peptides was restored by co-transfecting human BACE1, demonstrating that BACE1 is the only enzyme responsible for the processing of APP_NFEV in these cells. Analysis of APP_NFEV cleavage products secreted in the media revealed that in cells BACE1 cleaves APP_NFEV at the position between NF and EV, identical to that observed in vitro. A BACE inhibitor blocked the processing of the APP_NFEV beta-site in vitro and in cells. Our data indicates that the "NFEV" mutant is not only an enhanced substrate for BACE1 in vitro, but also a specific substrate for BACE1 in cells.