Cholinergic-glutamatergic interactions influence forms of synaptic plasticity that are thought to mediate memory and learning. We tested in vitro the induction of long-lasting synaptic enhancement at Schaffer collaterals by acetylcholine (ACh) at the apical dendrite of CA1 pyramidal neurons and in vivo by stimulation of cholinergic afferents. In vitro ACh induced a Ca2+ wave and synaptic enhancement mediated by insertion of AMPA receptors in spines. Activation of muscarinic ACh receptors (mAChRs) and Ca2+ release from inositol 1,4,5-trisphosphate (IP3)-sensitive stores were required for this synaptic enhancement that was insensitive to blockade of NMDA receptors and also triggered by IP3 uncaging. Activation of cholinergic afferents in vivo induced an analogous atropine-sensitive synaptic enhancement. We describe a novel form of synaptic enhancement (LTP(IP3)) that is induced in vitro and in vivo by activation of mAChRs. We conclude that Ca2+ released from postsynaptic endoplasmic reticulum stores is the critical event in the induction of this unique form of long-lasting synaptic enhancement.