The serpin alpha1-antichymotrypsin is a major component of brain amyloid plaques in Alzheimer's disease. In vitro alpha1-antichymotrypsin interacts with the Alzheimer's amyloid peptide Abeta1-42 and stimulates both formation and disruption of neurotoxic Abeta1-42 fibrils in a concentration-dependent manner. We have constructed a new hybrid model of the complex between Abeta1-42 and alpha1-antichymotrypsin in which both amino and carboxyl sequences of Abeta1-42 insert into two different beta-sheets of alpha1-antichymotrypsin. We have tested this model and shown experimentally that full-length and amino-terminal segments of Abeta1-42 bind to alpha1-antichymotrypsin as predicted. We also show that Abeta1-42 forms both intra- and intermolecular SDS-stable complexes with alpha1-antichymotrypsin and that the binding of Abeta1-42 to alpha1-antichymotrypsin abolishes the inhibitory activity of the latter and its ability to form stable complex with chymotrypsin. The existence of both inter- as well as intramolecular complexes of Abeta1-42 explains the nonlinear concentration-dependent effects of alpha1-antichymotrypsin on Abeta1-42 fibril formation, which we have reinvestigated here over a broad range of Abeta1-42:alpha1-antichymotrypsin ratios. These data suggest a molecular basis for the distinction between amorphous and fibrillar Abeta1-42 in vivo. The reciprocal effects of Abeta1-42 and alpha1-antichymotrypsin could play a role in the etiology of Alzheimer's disease.