The present study aimed to investigate the effect of transcranial alternating current stimulation (tACS) on the primary motor cortex (M1) during action observation, and subsequent action execution, on motor cortex excitability. The participants received tACS at 10 Hz or 20 Hz, or a sham stimulation over the left M1 for 10 min while they observed a video displaying a repeated button-tapping task using the right hand, and then performed an identical task with their right hand. Motor-evoked potential (MEP) amplitudes were measured before (T0) and after the action observation paired with tACS or a sham stimulation (T1), and after the performance of the action (T2). The results showed that MEPs were significantly reduced at time point T1 (p = 0.042, Cohen’s d = 0.611) and T2 (p = 0.0003, Cohen’s d = 0.852) in the 20 Hz tACS condition, in contrast with the sham stimulation. There was a significantly smaller MEP amplitude at time point T2 in the 20 Hz tACS condition, as compared to the 10 Hz tACS condition (p = 0.01, Cohen’s d = 0.622), but the MEP amplitude did not significantly change at time point T1 between the 20 Hz and 10 Hz tACS conditions (p = 0.136, Cohen’s d = 0.536). There were no significant differences at time point T1 and T2 between the 10 Hz tACS condition and the sham stimulation. We conclude that 20 Hz tACS during action observation inhibited motor cortex excitability and subsequently inhibited execution-related motor cortex excitability. The effects of tACS on task-related motor cortex excitability are frequency-dependent.