Alzheimer disease (AD), an age-related neurodegenerative disorder with progressive loss of memory and deterioration of comprehensive cognition, is characterized by extracellular senile plaques of aggregated beta-amyloid (Abeta), and intracellular neurofibrillary tangles that contain hyperphosphorylated tau protein. Recent studies showed that melatonin, an indoleamine secreted by the pineal gland, may play an important role in aging and AD as an antioxidant and neuroprotector. Melatonin decreases during aging and patients with AD have a more profound reduction in this hormone. Data from clinical trials indicate that melatonin supplementation improves sleep, ameliorates sundowning, and slows down the progression of cognitive impairment in Alzheimer patients. Melatonin efficiently protects neuronal cells from Abeta-mediated toxicity via antioxidant and anti-amyloid properties: it not only inhibits Abeta generation, but also arrests the formation of amyloid fibrils by a structure-dependent interaction with Abeta. Our recent studies have demonstrated that melatonin efficiently attenuates Alzheimer-like tau hyperphosphorylation. Although the exact mechanism is still not fully understood, a direct regulatory influence of melatonin on the activities of protein kinases and protein phosphatases is proposed. Additionally, melatonin also plays a role in protecting cholinergic neurons and in anti-inflammation. Here, the neuroprotective effects of melatonin and the underlying mechanisms by which it exerts its effects are reviewed. The capacity of melatonin to prevent or ameliorate tau and Abeta pathology further enhances its potential in the prevention or treatment of AD.