Using a functional selection system, we have isolated six cDNA clones, designated Apoptosis Linked Genes (ALG-1/6), able to inhibit TCR-induced cell death. Two of these genes, ALG-2 and ALG-3, have been studied in depth. ALG-3 is a truncated form of the mouse homologue of the chromosome 1 Alzheimer's disease Gene PS2. We have also identified a small PS2 mRNA, named PS2 short (PS-2s),that is structurally similar to ALG-3. In fact, ALG-3 and PS2s encode for similar truncated PS-2 proteins that can inhibit programmed cell death. Studies with the full length PS2 gene have revealed that this protein is required for cell death in both lymphoid and neuronal cells and that the truncated PS2 proteins produced by ALG-3 and PS2s function as dominant negative mutants. Of interest, an Alzheimer's PS2 mutant is constitutively active in inducing programmed cell death. Our studies suggest that disregulation of programmed cell death is the probable cause of Alzheimer's disease. ALG -2 is a calcium-binding protein required for cell death induced by all the stimuli tested to date. Preliminary studies indicate that ALG-2 functions downstream the Ced3-ICE family of proteases, previously considered to represent the irreversible step along the death pathway. These data indicate that ALG-2 is likely to be a key regulator of programmed cell death.