Synaptic growth is essential for the development and plasticity of neural circuits. To identify molecular mechanisms regulating synaptic growth, we performed a gain-of-function screen for synapse morphology mutants at the Drosophila neuromuscular junction (NMJ). We isolated a B' regulatory subunit of protein phosphatase 2A (PP2A) that we have named well-rounded (wrd). Neuronal overexpression of wrd leads to overgrowth of the synaptic terminal. Endogenous Wrd protein is present in the larval nervous system and muscle and is enriched at central and neuromuscular synapses. wrd is required for normal synaptic development; in its absence, there are fewer synaptic boutons and there is a decrease in synaptic strength. wrd functions presynaptically to promote normal synaptic growth and postsynaptically to maintain normal levels of evoked transmitter release. In the absence of wrd, the presynaptic cytoskeleton is abnormal, with an increased proportion of unbundled microtubules. Reducing PP2A enzymatic activity also leads to an increase in unbundled microtubules, an effect enhanced by reducing wrd levels. Hence, wrd promotes the function of PP2A and is required for normal cytoskeletal organization, synaptic growth, and synaptic function at the Drosophila NMJ.