Compelling evidence implicates self-assembly of amyloid-β (Aβ1–42) peptides into soluble oligomers and fibrils as a major underlying event in Alzheimer's disease (AD) pathogenesis. Herein, we employed amyloid-degrading keratinase (kerA) enzyme as a key Aβ1–42-binding scaffold to identify five keratinase-guided peptides (KgPs) capable of interacting with and altering amyloidogenic conversion of Aβ1–42. The KgPs showed micromolar affinities with Aβ1–42 and abolished its sigmoidal amyloidogenic transition, resulting in abrogation of fibrillogenesis. Comprehensive assessment using dynamic light scattering (DLS), atomic force microscopy (AFM) and Fourier-transform infrared (FTIR) spectroscopy showed that KgPs induced the formation of off-pathway oligomers comparatively larger than the native Aβ1–42 oligomers but with a significantly reduced cross-β signature. These off-pathway oligomers exhibited low immunoreactivity against oligomer-specific (A11) and fibril-specific (OC) antibodies and rescued neuronal cells from Aβ1–42 oligomer toxicity as well as neuronal apoptosis. Structural analysis using molecular docking and molecular dynamics (MD) simulations showed two preferred KgP binding sites (Lys16–Phe20 and Leu28–Val39) on the NMR ensembles of monomeric and fibrillar Aβ1–42, indicating an interruption of crucial hydrophobic and aromatic interactions. Overall, our results demonstrate a new approach for designing potential anti-amyloid molecules that could pave way for developing effective therapeutics against AD and other amyloid diseases.