Summary Alzheimer’s disease (AD) is the major cause of dementia. Brain circuit dysfunctions underlie the memory impairments of Alzheimer’s patients. Yet therapeutic approaches pursued in clinical trials failed to target circuits directly. Currently there is no cure. Neuronal activity disruptions have been described as contributing factors to the disease etiology and its progression. Anomalies in sleep-dependent brain rhythms, specifically slow oscillations important for consolidation of memories during deep NREM sleep, have been reported in Alzheimer’s patients. Converging evidence suggests that disruptions in slow oscillations are not simply symptomatic of the disease but facilitate Alzheimer’s progression and might contribute to dementia. Therefore, it is necessary to develop therapeutic strategies targeting restoration of circuit function, such as slow wave activity, to restore cognitive impairments associated with sleep-dependent memory dysfunction. Stem cell-based therapies hold promise for a number of neurological disorders including Alzheimer’s disease. Since deficits in inhibitory tone underly slow oscillation disruptions, restoration of inhibitory tone through transplantation of inhibitory interneuron progenitors might restore circuit function and slow Alzheimer’s progression. Thus, isolation of MGE-derived interneuron progenitors and their transplantation into an animal model of amyloidosis will be performed. We will systematically evaluate whether stem cell therapy restores slow wave activity, slows neuropathophysiology and rescues sleep as well as memory impairments. We propose to employ state-of-the-art methodology including widefield and multiphoton microscopy to monitor circuit function as well as optogenetics to control neuronal activity with high temporal precision. Thus, as a result of this work we will develop and evaluate the efficacy of stem cell therapy for the treatment of Alzheimer’s disease in a mouse model of amyloidosis, thus opening the possibility of translating cell therapy as a cure to slow AD progression in patients as part of a novel therapeutic approach.