Since the discovery of the beta-secretase responsible for initiating the Alzheimer's amyloid cascade as a novel membrane-bound aspartic proteinase, termed 'beta-site amyloid precursor protein cleaving enzyme', 'aspartyl protease-2' or 'membrane-anchored aspartic proteinase of the pepsin family-2', huge efforts have been devoted to an understanding of its biology and structure in the subsequent decade. This has paid off in many respects, as it has been cloned, its structure solved, novel physiological substrates of the enzyme discovered, and numerous inhibitors of its activity developed in a relatively short space of time. The inhibition of beta-secretase activity in vivo remains one of the most viable strategies for the treatment of Alzheimer's disease, although progress in getting inhibitors to the clinic has been slow, partly as a consequence of its aspartic proteinase character, which poses considerable problems for the production of potent, selective and brain-accessible compounds. This review reflects on the development of beta-secretase biology and chemistry to date, highlighting the diverse and innovative strategies applied to the modulation of its activity at the molecular and cellular levels.