Alzheimer's disease (AD) affects millions of people world-wide and new effective and safe therapies are needed. Cotinine, the main metabolite of nicotine, has a long half-life and does not have cardiovascular or addictive side effects in humans. We studied the effect of cotinine on amyloid-β (Aβ) aggregation as well as addressed its impact on working and reference memories. Cotinine reduced Aβ deposition, improved working and reference memories, and inhibited Aβ oligomerization in the brains of transgenic (Tg) 6799 AD mice. In vitro studies confirmed the inhibitory effect of cotinine on Aβ1-42 aggregation. Cotinine stimulated Akt signaling, including the inhibition of glycogen synthase kinase 3β (GSK3β), which promotes neuronal survival and the synaptic plasticity processes underlying learning and memory in the hippocampus and cortex of wild type and Tg6799 AD mice. Simulation of the cotinine–Aβ1-42 complex using molecular dynamics showed that cotinine may interact with key histidine residues of Aβ1-42, altering its structure and inhibiting its aggregation. The good safety profile in humans and its beneficial effects suggest that cotinine may be an excellent therapeutic candidate for the treatment of AD.