Memory-based cognition relies on the integrity of cortico-hippocampal circuits, which are compromised in Alzheimer's disease (AD) as β-amyloid (Aβ) and tau accumulate. However, the mechanisms linking this pathology to circuit dysfunction remain unclear. In mouse models, using in vivo two-photon and Neuropixels recordings, we show that Aβ-tau pathology promotes both region- and layer-specific impairments, involving reduced burst firing in superficial cortical layers and CA1 and reduced mean firing of excitatory and inhibitory neurons in deep cortical layers and CA1. Exposure to Aβ primed the susceptibility of neuronal populations to tau-induced impairment. Combined Aβ-tau reduced synaptic NMDA receptor (NMDAR) density in both mouse and human tissue, while Aβ-tau co-reduction restored NMDARs and firing patterns and improved contextual memory. NMDAR antagonism in healthy mice phenocopied regional and laminar deficits. Our findings implicate synaptic NMDAR hypofunction as a reversible mechanism linking Aβ-tau synergy to cortico-hippocampal dysfunction in AD.