Prion protein (PrP^C) interacts with 38 to 42 amino acid amyloid-β (Aβ) peptides released by proteolytic processing of amyloid precursor protein (APP). Our laboratory previously reported a direct relationship between PrP$^C$ expression and the levels of secreted Aβ_{42}, but the underlying mechanisms were unclear. I sought to test whether PrP^C exerts its effect on Aβ by modulating APP processing. I quantified APP synthesis and Aβ secretion following siRNA-induced knockdown (KD) of PrP^C in mouse neuroblastoma (N2a) cells stably expressing human APPwt (N2a-APPwt) or human APP carrying the Swedish mutation (N2a-APPswe). PrP^C KD significantly reduced net Aβ peptide secretion in both cell lines without affecting APP expression or extracellular Aβ degradation. PrP^C KD also significantly reduced sAPPβ release in both cell lines and increased sAPPα production in N2a-APPwt but not in N2a-APPswe cells. Surface biotinylation and immunofluorescence labeling studies revealed an increase in the levels of surface APP and an increase in intracellular APP C-terminal fragments (CTFs) following PrP^C KD. Using a previously validated method to assess APP CTF levels in vivo, I found an increase in APP CTF levels in female transgenic mice lacking PrP^C compared to wild-type mice. These findings are consistent with a model whereby PrP^C expression limits APP delivery to the plasma membrane and APP internalization, facilitating amyloidogenic APP processing and Aβ secretion. Our results suggest that reducing PrP^C expression might be a therapeutic avenue for treating AD by limiting BACE1-cleavage of APP, an essential step in Aβ production.