LONG-TERM potentiation (LTP) is a synaptic mechanism thought to be involved in learning and memory(1). Long-term depression (LTD), an activity-dependent decrease in synaptic efficacy, may be an equally important mechanism which permits neural networks to store information more effectively(2,3). One form of LTD that has been observed in the hippocampus(4) requires activation of postsynaptic NMDA (N-methyl-D-aspartate) receptors(4,5), a change in postsynaptic calcium concentration(5), and activation of postsynaptic serine/threonine protein phosphatase 1 (PP1) or 2A (PP2A)(6). The mechanism by which PP1 or PP2A is regulated by synaptic activity is unclear because these protein phosphatases are not directly influenced by calcium concentration. LTD induction may require activation of a more complex protein phosphatase cascade consisting of the Ca2+/calmodulin-dependent protein phosphatase, calcineurin, its phosphoprotein substrate, inhibitor-1, and PP1(7,8). We tested this hypothesis using calcineurin inhibitors as well as different forms of inhibitor-1 loaded into postsynaptic cells. Our results suggest a signalling pathway in which calcineurin dephosphorylates and inactivates inhibitor-1. This in turn increases PP1 activity and contributes to the generation of LTD.