The core reason for the absence of interference of fractional charges (in the lowest Landau level) has long been a subject of discussions. Certainly there is dephasing of quasiparticles, but the agent behind this havoc was never singled out experimentally. While interference of electrons has been routinely observed in the integer regime, it gradually reduced as the filling was reduced towards ff=1, where it fully quenched, not to recover in the fractional regime. Here, we have systematically studied the Aharonov-Bohm interference in a Mach-Zehnder interferometer (MZI) and correlated it with the appearance of upstream neutral modes. The latter were determined by an appearance of a conductance plateau of ff =1/3 in a quantum point contact (QPC), which carried shot-noise. As the bulk filling approached ff =1 a substantial drop in the visibility was observed, concomitantly with the appearance ff =1/3 noisy conductance plateau in the QPC (of the MZI) - pointing at the birth of neutral modes at the QPC. Such ff =1/3 conductance plateau persisted throughout the hole-conjugate regime, where interference was absent. We believe that unexpected edge reconstruction, favored in a rather soft edge potential at 2>ff>1 gives birth to upstream neutral modes that dephase the interference.