The invention concerns a novel .beta.-secretase, a method of partially purifying this novel .beta.-secretase, and its use in assays to screen for potential drug candidates against Alzheimer's disease and other neurological diseases. The novel .beta.-secretase has an estimated molecular weight of about 32-39 kDa or 22-26 kDa in HEK293 cell membrane extracts and human brain samples, respectively, as calculated from radiation inactivation analysis, and has a pH optimum at about pH 6.5-7.0.