APOE4 allele is a major risk factor for late-onset Alzheimer disease (AD). The mechanism of action of APOE in AD remains unclear. To study the effects of APOE alleles on gene expression in AD, we have analyzed the gene transcription patterns of human hippocampus from APOE3/3, APOE3/4, APOE4/4 AD patients and normal control using Serial Analysis of Gene Expression (SAGE). Using SAGE, we found gene expression patterns in hippocampus of APOE3/4 and APOE4/4 AD patients differ substantially from those of APOE3/3 AD patients. APOE3/4 and APOE4/4 allele expression may activate similar genes or gene pools with associated functions. APOE4 AD alleles activate multiple tumor suppressors, tumor inducers and negative regulator of cell growth or repressors that may lead to increased cell arrest, senescence and apoptosis. In contrast, there is decreased expression of large clusters of genes associated with synaptic plasticity, synaptic vesicle docking and fusing and axonal/neuronal outgrowth. In addition, reduction of neurotransmitter receptors and Ca2+ homeostasis, disruption of multiple signal transduction pathways, loss of cell protection, and perhaps most notably, mitochondrial oxidative phosphorylation/energy metabolism are associated with APOE3/4 and APOE4/4 AD alleles. These findings may help define the mechanisms that APOE4 contribute that increase risk for AD and identify new candidate genes conferring susceptibility to AD.