In Alzheimer's disease, the microtubule-associated protein tau forms intracellular neurofibrillary tangles (NFTs). A critical step in the formation of NFTs is the conversion of soluble tau into insoluble filaments. Accordingly, a current therapeutic strategy in clinical trials is aimed at preventing tau aggregation. Here, we assessed altenusin, a bioactive polyphenolic compound, for its potential to inhibit tau aggregation. Altenusin inhibits aggregation of tau protein into paired helical filaments in vitro. This was associated with stabilization of, tau dimers and other oligomers into globular structures as revealed by atomic force microscopy. Moreover, altenusin reduced tau phosphorylation in cells expressing pathogenic tau, and prevented neuritic tau pathology induced by incubation of primary neurons with tau fibrils. However, treatment of tau transgenic mice did not improve neuropathology and functional deficits. Taken together, altenusin prevents tau fibrillization in vitro and induced tau pathology in neurons.