Cholinergic hypothesis and amyloid cascade hypothesis are mainly proposed for Alzheimer's disease; however, the relationship between these hypotheses is poorly understood. To address the question of whether amyloid beta-peptide pathology affects cholinergic neurotransmission, we examined the effect of a cholinesterase inhibitor, physostigmine, on field excitatory postsynaptic potentials (EPSPs) evoked by single-pulse stimulation in the CA1 region of the hippocampus of various APPswe/PS1dE9 transgenic mice with different degrees of amyloid beta-peptide pathology. Reduced field EPSPs by physostigmine in transgenic mice at 3 months of age, when the mice had negligible amyloid beta-peptide levels and no amyloid beta-peptide deposits, were indistinguishable from those in age-matched wild-type mice. In contrast, reduced field EPSPs by physostigmine in transgenic mice at 5 months of age, when the mice had low amyloid beta-peptide levels and subtle amyloid beta-peptide deposits, were significantly lower than those in age-matched wild-type mice. Next, we characterized acetylcholine receptors, which play important roles in cholinergic neurotransmission, because physostigmine resulted in increased acetylcholine levels in the synaptic cleft. Different reductions of field EPSPs by physostigmine between transgenic and wild-type mice at 5 months of age were not affected by a nicotinic receptor antagonist, mecamylamine; however, reduced field EPSPs by physostigmine in both transgenic and wild-type mice were restored to basal levels by a muscarinic receptor antagonist, atropine. These results indicate that cholinergic modulation of glutamatergic transmission is already impaired at the onset of the formation of amyloid beta-peptide deposits, and muscarinic receptor dysfunction is one of the causes of this impairment.