Human amyloid beta (Aβ42) is unusually prone to self-association, and its oligomers manifest a gain-of-function neurotoxicity. Evidence strongly indicates that soluble Aβ oligomers (AβOs), not amyloid plaques, are the pathogenic form of Aβ in Alzheimer’s disease (AD). AβOs manifest in an AD-dependent manner in humans and animal models. Experimentally, they induce memory dysfunction and multiple facets of AD neuropathology. Evolutionary retention of the toxin-forming Aβ sequence is surprising but could be explained if, under some circumstances, AβOs were essential to neural function. Supporting this idea, we have discovered that AβOs are transiently expressed in the developing retina of chick (which has an Aβ sequence identical to humans) and are required for proper cell placement. AβOs appear first in the optic nerve layer, spread outward into specific cell bodies and synaptic layers, then down-regulate, with low expression remaining near photoreceptors. AβO expression is like a molecular wave progressing across the retina, virtually disappearing when circuitry has been established. Intravitreal injections of BACE inhibitor or AβO antibody during development cause disrupted nerve cell placement and formation of retina folds as found in various pathological conditions. AβOs thus constitute a new type of peptidergic hormone with a critical short-lived role in CNS development, suggesting AβO presence in AD may be a pathological reprise of a role played in neural development.