Adult neurogenic decline, inflammation, and neurodegeneration are phenotypic hallmarks of Alzheimer’s disease (AD). Mobilization of transposable elements (TEs) in heterochromatic regions was recently reported in AD, but the underlying mechanisms are still underappreciated. Combining functional genomics with the differentiation of familial and sporadic AD patient derived-iPSCs into hippocampal progenitors, CA3 neurons, and cerebral organoids, we found that the upregulation of the AP-1 subunit, c-Jun, triggers decondensation of genomic regions containing TEs. This leads to the cytoplasmic accumulation of HERVK-derived RNA-DNA hybrids, the activation of the cGAS-STING cascade, and increased levels of cleaved caspase-3, suggesting the initiation of programmed cell death in AD progenitors and neurons. Notably, inhibiting c-Jun effectively blocks all these downstream molecular processes and rescues neuronal death and the impaired neurogenesis phenotype in AD progenitors. Our findings open new avenues for identifying therapeutic strategies and biomarkers to counteract disease progression and diagnose AD in the early, pre-symptomatic stages.