Background: Polyglutamine expansion diseases are a group of hereditary neurodegenerative disorders that develop when a CAG repeat in the causative genes are unstably expanded above a certain threshold. The expansion of trinucleotide CAG repeats cause hereditary adult-onset neurodegenerative disorders such as Huntington's disease, dentatorubral-pallidoluysian atrophy, spinobulbar muscular atrophy and multiple forms of spinocerebellar ataxia (SCA). The most common dominantly inherited spinocerebellar ataxia is the type 3 (SCA3) also known as Machado-Joseph disease (MJD), is an autosomal dominant, progressive neurological disorder. The gene causatively associated with MJD is ATXN3. Recent studies have shown that this gene modulates endoplasmic reticulum (ER) stress. Results: We generated transgenic C. elegans strains expressing human ATXN3 genes in motor neurons, and animals expressing mutant ATXN3-CAG89 alleles showed decreased lifespan, impaired movement, and rates of neurodegeneration greater than wild type ATXN3-CAG10 controls. We tested three neuroprotective compounds (methylene blue, guanabenz and salubrinal) believed to modulate ER stress and observed that these molecules rescued ATXN3-CAG89 phenotypes. Furthermore, these compounds required specific branches of ER unfolded protein response (UPRER), reduced global ER and oxidative stress, as well as polyglutamine aggregation. Conclusions: We introduce novel C. elegans models for MJD based on the expression of full-length ATXN3 in a limited number of neurons. Using these models, we discovered that chemical modulation of the UPRER reduced neurodegeneration and warrants investigation in mammalian models of MJD.