Introduction: Tau, a natively unfolded soluble protein, forms abnormal oligomers and insoluble filaments in several neurodegenerative diseases, including Alzheimer disease (AD). Tau-induced toxicity is mainly due to oligomers rather than monomers or fibrils. Methods: We have developed monoclonal antibodies against purified low-n tau oligomers of the tau repeat domain as a tool to neutralize tau aggregation and toxicity. In vitro aggregation inhibition was tested by thioflavin S, dynamic light scattering (DLS), and atomic force microscopy (AFM). Using a split-luciferase complementation assay and fluorescence-activated cell sorting (FACS), the inhibition of aggregation was analyzed in an N2a cell model of tauopathy. Results: Antibodies inhibited tau aggregation in vitro up to ~90% by blocking tau at an oligomeric state. Some antibodies were able to block tau dimerization/oligomerization in cells, as measured by a split-luciferase complementation assay. Antibodies applied extracellularly were internalized and led to sequestration of tau into lysosomes for degradation. Discussion: Novel low-n tau oligomer specific monoclonal antibody inhibits Tau oligomerization in cells and promotes toxic tau clearance.