The formation of synapses and the proper construction of neural circuits depend on signaling pathways that regulate cytoskeletal structure and dynamics. After the mutual recognition of a growing axon and its target, multiple signaling pathways are activated that regulate cytoskeletal dynamics to determine the morphology and strength of the connection. By analyzing Drosophila mutations in the cytoplasmic FMRP interacting protein Cyfip, we demonstrate that this component of the WAVE complex inhibits the assembly of filamentous actin (F-actin) and thereby regulates key aspects of synaptogenesis. Cyfip regulates the distribution of F-actin filaments in presynaptic neuromuscular junction (NMJ) terminals. At cyfip mutant NMJs, F-actin assembly was accelerated, resulting in shorter NMJs, more numerous satellite boutons, and reduced quantal content. Increased synaptic vesicle size and failure to maintain excitatory junctional potential amplitudes under high-frequency stimulation in cyfip mutants indicated an endocytic defect. cyfip mutants exhibited upregulated bone morphogenetic protein (BMP) signaling, a major growth-promoting pathway known to be attenuated by endocytosis at the Drosophila NMJ. We propose that Cyfip regulates synapse development and endocytosis by inhibiting actin assembly.