Foundation models have transformed computational pathology by providing generalizable representations from large-scale histology datasets. However, existing models are predominantly trained on surgical pathology data, which is enriched for non-nervous tissue and overrepresents neoplastic, inflammatory, metabolic, and other non-neurological diseases. Neuropathology represents a markedly different domain of histopathology, characterized by unique cell types (neurons, glia, etc.), distinct cytoarchitecture, and disease-specific pathological features including neurofibrillary tangles, amyloid plaques, Lewy bodies, and pattern-specific neurodegeneration. This domain mismatch may limit the ability of general-purpose foundation models to capture the morphological patterns critical for interpreting neurodegenerative diseases such as Alzheimer's disease, Parkinson's disease, and cerebellar ataxias. To address this gap, we developed NeuroFM, a foundation model trained specifically on whole-slide images of brain tissue spanning diverse neurodegenerative pathologies. NeuroFM demonstrates superior performance compared to general-purpose models across multiple neuropathology-specific downstream tasks, including mixed dementia disease classification, hippocampal region segmentation, and neurodegenerative ataxia identification encompassing cerebellar essential tremor and spinocerebellar ataxia subtypes. This work establishes that domain-specialized foundation models trained on brain tissue can better capture neuropathology-specific features than models trained on general surgical pathology datasets. By tailoring foundation models to the unique morphological landscape of neurodegenerative diseases, NeuroFM enables more accurate and reliable AI-based analysis for brain disease diagnosis and research, setting a precedent for domain-specific model development in specialized areas of digital pathology.