Increased activity of calpains is implicated in synaptic dysfunction and neurodegeneration in Alzheimer's disease (AD). The molecular mechanisms responsible for increased calpain activity in AD are not known. Here, we demonstrate that disease progression is propelled by a marked depletion of the endogenous calpain inhibitor, calpastatin (CAST), from AD neurons, which is mediated by caspase-1, caspase-3, and calpains. Initial CAST depletion focally along dendrites coincides topographically with calpain II and ERK 1/2 activation, tau cleavage by caspase-3, and tau and neurofilament hyperphosphorylation. These same changes, together with cytoskeletal proteolysis and neuronal cell death, accompany CAST depletion after intrahippocampal kainic acid administration to mice, and are substantially reduced in mice overexpressing human CAST. Moreover, CAST reduction by shRNA in neuronal cells causes calpain-mediated death at levels of calcium-induced injury that are sublethal to cells normally expressing CAST. Our results strongly support a novel hypothesis that CAST depletion by multiple abnormally activated proteases accelerates calpain dysregulation in AD leading to cytoskeleton disruption and neurodegeneration. CAST mimetics may, therefore, be neuroprotective in AD.