Functional properties of the neural cell adhesion molecule (NCAM) are strongly influenced by polysialylation. We used gene-targeting to generate mice lacking ST8SiaIV/PST-1, one of the polysialyltransferases responsible for addition of polysialic acid (PSA) to NCAM. Mice homozygous for the null mutation reveal normal development of gross anatomical features. In contrast to NCAM-deficient mice, olfactory precursor cells in the rostral migratory stream express PSA and follow their normal pathway. Furthermore, delamination of mossy fibers in the hippocampal CA3 region, as found in NCAM-deficient mice, does not occur in ST8SiaIV mutants. However, during postnatal development these animals show a decrease of PSA in most brain regions compared to wild-type animals. Loss of PSA in the presence of NCAM protein but in the absence of obvious histological changes allowed us to directly address the role of PSA in synaptic plasticity. Schaffer collateral-CA1 synapses, which express PSA in wild types, showed impaired long-term potentiation (LTP) and long-term depression (LTD) in adult mutants. This impairment was age-dependent, following the time course of developmental disappearance of PSA. Contrary to NCAM mutant mice, LTP in ST8SiaIV mutants was undisturbed at mossy fiber–CA3 synapses, which do not express PSA in wild-type mice. The results demonstrate an essential role for ST8SiaIV in synaptic plasticity in hippocampal CA1 synapses, whereas PSA produced by different polysialyltransferase or polysialyltransferases at early stages of differentiation regulates migration of neural precursor cells and correct lamination of mossy fibers. We suggest that NCAM but not PSA is likely to be important for LTP in the hippocampal CA3 region.