In the adult brain, the expression of NT-3 is largely confined to the hippocampal dentate gyrus (DG), an area exhibiting significant neurogenesis. Using a conditional mutant line in which the NT-3 gene is deleted in the brain, we investigated the role of NT-3 in adult neurogenesis, hippocampal plasticity, and memory. Bromodeoxyuridine (BrdU)-labeling experiments demonstrated that differentiation, rather than proliferation, of the neuronal precursor cells (NPCs) was significantly impaired in DG lacking NT-3. Triple labeling for BrdU, the neuronal marker NeuN, and the glial marker GFAP indicated that NT-3 affects the number of newly differentiated neurons, but not glia, in DG. Field recordings revealed a selective impairment in long-term potentiation (LTP) in the lateral, but not medial perforant path-granule neuron synapses. In parallel, the NT-3 mutant mice exhibited deficits in spatial memory tasks. In addition to identifying a novel role for NT-3 in adult NPC differentiation in vivo, our study provides a potential link between neurogenesis, dentate LTP, and spatial memory.