An effective, disease-modifying treatment of Alzheimers disease (AD) remains one of the most significant unmet needs in modern medicine. As a result of the extensive research in the area, the mechanisms underlying the disease are now much better understood than at any time before. A significant amount of evidence points to the central role of β-amyloid (Aβ) peptide-mediated toxicity in the disease etiology and strategies to remove this species from the central nervous system (CNS) have been actively pursued. The enzyme responsible for the final step in Aβ synthesis, γ-secretase, has emerged as an attractive drug target and intensive research has transformed this enzyme from shadowy beginnings into a well characterised member of a new family of intramembrane-cleaving aspartyl proteases. Many inhibitors across diverse structural classes have been discovered and have demonstrated a lowering of central Aβ levels in preclinical models of AD. It has also become increasingly evident more recently that γ-secretase also mediates a range of cleavages of alternative transmembrane peptides most notably the Notch receptor and the functional consequences of this activity have attracted much attention. The ultimate therapeutic benefit of γ-secretase inhibitors and the effect of alternative, mechanism-based activities can only be judged when clinical data is forthcoming. In this review we describe the literature regarding the discovery of the nature of γ-secretase, the development of small molecule inhibitors and their in vivo profiles.