Formation of β-Amyloid (Aβ) plaques is one of the most significant pathological features of Alzheimer’s disease (AD). Detection and degradation of Aβ plaques are crucial in AD treatment. When Aβ monomers aggregate to form plaques, they produce strong autofluorescence. In this study, we investigate label-free imaging of Aβ plaques by using the nonlinear optical imaging method and study their degradation via photodynamic effect of the photosensitizer. Moreover, we study the relationship between photosensitizers with different concentrations and degradation effect of Aβ plaques. Corresponding liposomes are prepared and they are applied to the degradation of Aβ plaques. The potential applications of label-free optical imaging and photodynamic therapy in AD research are discussed, and a new way for optimizing AD diagnosis and treatment is provided.