The protein alpha-synuclein (αS) self-assembles into toxic beta-sheet aggregates in Parkinson’s disease, while it is proposed that αS forms soluble alpha-helical multimers in healthy neurons. Here, we have made αS multimers in vitro using arachidonic acid (ARA), one of the most abundant fatty acids in the brain, and characterized them by a combination of bulk experiments and single-molecule Fӧrster resonance energy transfer (sm-FRET) measurements. The data suggest that ARA-induced oligomers are alpha-helical, resistant to fibril formation, more prone to disaggregation, enzymatic digestion and degradation by the 26S proteasome, and lead to lower neuronal damage and reduced activation of microglia compared to the oligomers formed in the absence of ARA. These multimers can be formed at physiologically-relevant concentrations, and pathological mutants of αS form less multimers than wild-type αS. Our work provides strong biophysical evidence for the formation of alpha-helical multimers of αS in the presence of a biologically relevant fatty acid, which may have a protective role with respect to the generation of beta-sheet toxic structures during αS fibrillation.