One of the hallmarks of Alzheimer’s disease is the formation of extracellular amyloid plaques that consist mainly of abnormally aggregated forms of amyloid β (Aβ) peptides. These peptides are generated by γ-secretase– catalyzed cleavage of a dimeric membrane-bound C-terminal fragment (C99) of the amyloid precursor protein. Although C99 homodimerization has been linked to Aβ production and changes in the aggregation-determining Aβ42/Aβ40 ratio, the motif through which C99 dimerizes has remained controversial. Here, we have used two independent assays to gain insight into C99 homodimerization in the context of the membrane of live cells: bioluminescence resonance energy transfer and Tango membrane protein–protein interaction assays, which were further confirmed by traditional pull-down assays. Our results indicate a four-amino acid region within the C99 transmembrane helix (43TVIV46) as well as its local secondary structure as critical determinants for homodimerization. These four amino acids are also a hot spot of familial Alzheimer’s disease–linked mutations that both decrease C99 homodimerization and γ-secretase cleavage and alter the initial cleavage site to increase the Aβ42/40 ratio.