The Drosophila mutant loechrig, which lacks a neuronal isoform of the AMPK (AMP- activated protein kinase) gamma subunit, shows progressive neurodegeneration, neuronal cell death of the adult nervous system and a lower cholesterol ester level. AMPK is the "energy sensor" of the cell and it gets phosphorylated by upstream kinases and activated by a high AMP-ATP ratio. In order to determine the correlation between the loe mutation, isoprenylation and the RHO1 pathway, flies with mutations in RHO and its downstream targets were generated and analyzed. Isoprenylation (which is negatively regulated by AMPK) is an important mechanism allowing intracellular proteins, like small G proteins (e.g. RHO) to associate with the membrane, which is then followed by activation of the protein. This step is critical for signal transduction of cellular hormones a growth factors, and cytokines and influences proliferation, differentiation and survival of the cell. This dissertation shows that actin dynamics is not only involved in neuronal outgrowth, its also important in maintenance of neurons. And interference with actin dynamics and axonal transport leads to progressive degeneration of neurons.