Abstract: Alzheimer's disease (AD) is the most prevalent neurodegenerative disease of the brain. Due to the uncertain pathogenesis, prevention and treatment of AD is difficult. Clinic symptoms of AD including progressive loss of memory and spatial orientation are rooted in synaptic and neuronal loss. Unsuccessful clinical trials of several candidate drugs based on amyloid hypothesis and tau hypothesis have led to exploration of new approaches. Neuro-inflammation characterized by dysfunction in microglia is believed to be the hallmark of AD and also the initiator of downstream responses in neurodegeneration. Alleviate microglia activation and neuro-inflammation may delay AD development. In this paper, we describe the current literature on interaction between microglia and neuron, and review the progress in AD drug discovery and neuro-inflammatory inhibitors for treatment of AD.