γ-secretase is an intramembranous protein complex that cleaves many type-I membrane proteins, including the Notch receptor and the β-amyloid precursor protein (APP). Interest in γ-secretase comes, in part, from the fact that this multiprotein complex is responsible for the cleavage of APP that generates the amyloid-β peptide (Aβ), one of the primary components of amyloid plaques in Alzheimers disease (AD). Over the last years, molecular identification of the complex has shown that γ-secretase is an aspartyl protease composed of four different members that are essential for the enzymatic activity: presenilin 1, aph1, pen-2 and nicastrin. In recent years, an increasing number of type-I membrane proteins have been shown to be cleaved by γ-secretase. How the enzyme cleaves such a set of substrates with diverse functions and subcellular localizations is not well understood. In overexpression assays, the γ-secretase cleavage of some substrates releases intracellular domains with signaling properties. On the other hand, the loose specificity required for intramembrane cleavage has raised the possibility of γ-secretase as the membrane proteasome. The impact of γ-secretase on other substrates has clear implications for the development of new therapies for AD, and in particular for the search of γ-secretase inhibitors or modulators. Interference with the cleavage of some of the γ-secretase substrates has been shown to be associated with serious adverse effects in animal models. The understanding of the mechanism by which γ-secretase recognizes and cleaves all these proteins is of great importance to clarify the function of γ-secretase and its role as a therapeutic target in AD, and possibly in other diseases in which γ- secretase is involved.