Alzheimer's disease (AD) is a neurodegenerative disease pathologically characterized by amyloid plaques and neurofibrillary tangles in the brain. Before these hallmark features appear, signs of axonal transport defects develop, though the initiating events are not clear. Enhanced amyloidogenic processing of amyloid precursor protein (APP) plays an integral role in AD pathogenesis, and previous work suggests that both the Aβ region and the C-terminal fragments (CTFs) of APP can cause transport defects. However, it remains unknown if APP processing affects the axonal transport of APP itself, and whether increased APP processing is sufficient to promote axonal dystrophy. We tested the hypothesis that β-secretase cleavage site mutations of APP alter APP axonal transport directly. We found that the enhanced β-secretase cleavage reduces the anterograde axonal transport of APP, while inhibited β-cleavage stimulates APP anterograde axonal transport. Transport behavior of APP after treatment with β- or γ-secretase inhibitors suggests that the amount of β-secretase cleaved CTFs (βCTFs) of APP underlies these transport differences. Consistent with these findings, βCTFs have reduced anterograde axonal transport compared with full-length, wild-type APP. Finally, a gene-targeted mouse with familial AD (FAD) Swedish mutations to APP, which enhance the β-cleavage of APP, develops axonal dystrophy in the absence of mutant protein overexpression, amyloid plaque deposition and synaptic degradation. These results suggest that the enhanced β-secretase processing of APP can directly impair the anterograde axonal transport of APP and are sufficient to lead to axonal defects in vivo.