Basal forebrain cholinergic neurons are severely depleted early in Alzheimer's disease and appear particularly susceptible to amyloid β‐peptide (Aβ) toxicity in vivo. To model this effect in vitro, a cholinergic septal cell line (SN56) was exposed to Aβ. SN56 cells exhibited a tetraethylammonium (TEA)‐sensitive outward K+ current with delayed rectifier characteristics. Increases of 64% (±19; p < 0.02) and 44% (±12; p < 0.02) in K+ current density were noted 6–12 and 12–18 h following the addition of Aβ to SN56 cell cultures, respectively. Morphological observation and staining for cell viability showed that 25 ± 4 and 39 ± 4% of SN56 cells were dead after 48‐ and 96‐h exposures to Aβ, respectively. Perfusion of SN56 cells with 10–20 mM TEA blocked 71 ± 6 to 92 ± 2% of the outward currents, widened action potentials, elevated [Ca2+]i, and inhibited 89 ± 14 and 68 ± 14% of the Aβ toxicity. High [K+]o, which depolarizes cell membranes and increases [Ca2+]i, also protected SN56 cells from Aβ toxicity. This effect appeared specific since glucose deprivation of SN56 cells did not alter K+ current density and TEA did not protect these cells from hypoglycemic cell death. Furthermore, Aβ was toxic to a dopaminergic cell line (MES23.5) that expressed a K+ current with delayed rectifier characteristics; K+ current density was not altered by Aβ and MES23.5 cells were not protected by TEA from Aβ toxicity. In contrast, a noncholinergic septal cell line (SN48) that shows minimal outward K+ currents was resistant to the toxicity of Aβ. These data suggest that a K+ channel with delayed rectifier characteristics may play an important role in Aβ‐mediated toxicity for septal cholinergic cells.