The human body, including the brain, produces and processes formaldehyde all the time. Formaldehyde is active in the reaction with biomacromolecules, especially with proteins. So, neuronal proteins have chances to react directly with formaldehyde. Among the proteins, neuronal Tau is extremely prone to react with formaldehyde because Tau features in “wormlike” conformation, and its α−/ε-amino groups are exposed to the protein exterior. Tau is a multifunctional protein which is able to bind to microtubule, actin, DNA, and RNA, with its proline-rich domain and microtubule-binding domain (MBD). Tau promotes the melting temperature of double-stranded DNA and accelerates refolding of denatured DNA. Interaction between Tau and DNA forms a complex called “DNA-Tauosome,” which may be the structure in resistance to the attack of free radicals, for example, reactive oxygen species (ROS). Treatment with formaldehyde inactivates Tau protein in the interaction with microtubule as well as DNA in which the formation of DNA-Tauosome is inhibited. In terms of the interaction between Tau protein and RNAs, it is reflected in phosphorylated protein-induced RNA accumulation, or RNA-induced protein accumulation, or interaction, so as to explore ways to prevent their accumulation and explore the treatment. Formaldehyde induces Tau aggregation which features in globular-like deposits stained with Congo red and probed by the fluorescence of thioflavin T (ThT). The cytotoxicity of globular-like aggregate leads to the impairment of cell viability and eventually to cell death. Abnormal lysosomes increase as aging and so does endogenous formaldehyde. Dysfunction of lysosome and formaldehyde metabolism could be the major risk factors to impede the cellular degradation and scavenging of protein aggregation since lysosome is one of organelles for endogenous formaldehyde to be localized. Formaldehyde is actively and directly reacted with the side chains such as amino group and thial group of peptides and proteins, In this chapter, we mainly discuss the effect of chemical modification with formaldehyde on morphology and function of neuronal Tau, except for phosphorylation, glycosylation, and other modifications. The mechanism of formaldehyde-induced cognitive impairment involves the dysfunction of NMDA receptors caused by direct binding of formaldehyde to NMDA receptors or by inducing Tau hyperphosphorylation and Aβ deposition. Formaldehyde also interacts with monoamine neurotransmitters, resulting in the inactivation of neurotransmitters such as catecholamine and serotonin, which contribute to understanding of the dysfunction of synaptic transmission, as well as cognitive impairment.