The coexistence of amyloid-β (Aβ) plaques and tau neurofibrillary tangles in the neocortex is linked to neural system failure and cognitive decline in Alzheimer's disease. However, the underlying neuronal mechanisms are unknown. By employing in vivo two-photon Ca2+ imaging of layer 2/3 cortical neurons in mice expressing human Aβ and tau, we reveal a dramatic tau-dependent suppression of activity and silencing of many neurons, which dominates over Aβ-dependent neuronal hyperactivity. We show that neurofibrillary tangles are neither sufficient nor required for the silencing, which instead is dependent on soluble tau. Surprisingly, although rapidly effective in tau mice, suppression of tau gene expression was much less effective in rescuing neuronal impairments in mice containing both Aβ and tau. Together, our results reveal how Aβ and tau synergize to impair the functional integrity of neural circuits in vivo and suggest a possible cellular explanation contributing to disappointing results from anti-Aβ therapeutic trials.