Abstract Bone morphogenetic protein 7 (BMP7) has neuroprotective effects against ischemia, oxidation stress, and lipopolysaccharide, but its role on amyloid-beta (Aβ)-induced neurotoxicity in Alzheimer's disease (AD) and the underlying mechanisms remain unclear. In this study, we exposed PC12 cells to Aβ25-35 for 26 h to induce neurotoxicity, and added exogenous BMP7 at 2 h to observe the neuroprotective effects. The protective mechanisms involved, mostly related to inhibition of cell apoptosis and oxidation stress, were analyzed. In rat in vivo experiments, we bilaterally injected Aβ1-40 into the basal forebrain to simulate neuropathological processes in AD, performed the Morris water maze test to evaluate the effect of Aβ on spatial learning and memory, and explored the change of endogenous BMP7 expression in the brain. The present study demonstrated that BMP7 prevented neuronal injuries in PC12 cells induced by Aβ25-35, including cell apoptosis and morphological impairment of dendrites as well as oxidation stress. BMP7 treatment significantly protected PC12 cells against Aβ25-35-induced injury and inhibited the increasing content of the Bax gene and the decreasing activities of superoxide dismutase (SOD). Aβ1-40 bilaterally injected into the rat basal forebrain obviously inhibited the rat's spatial learning ability and memory, and significantly induced downregulation of endogenous BMP7 in the basal forebrain while upregulating it in the hippocampus. Our results suggest that BMP7 has neuroprotective effects against Aβ, which may be mediated through inhibition of Bax gene expression during cell apoptosis and elevation of SOD activities during the oxidative stress response. On the other hand, endogenous BMP7 may have a potential self-modulation capacity through negative feedback between the region of the basal forebrain and the hippocampus as a protective cytokine.