Recent genome-wide association studies on major depressive disorder have implicated neuronal growth regulator 1 (Negr1), a GPI-anchored cell adhesion molecule in the immunoglobulin LON family. Although Negr1 has been shown to regulate neurite outgrowth and synapse formation, the mechanism through which this protein affects mood disorders is still largely unknown. In this research, we characterized Negr1-deficient (negr1-/-) mice to elucidate the function of Negr1 in anxiety and depression. We found that anxiety- and depression-like behaviors increased in negr1-/- mice compared with wild-type mice. In addition, negr1-/- mice had decreased adult hippocampal neurogenesis compared to wild-type mice. Concurrently, both LTP and mEPSC in the dentate gyrus (DG) region were severely compromised in negr1-/- mice. In our effort to elucidate the underlying molecular mechanisms, we found that lipocalin-2 (Lcn2) expression was decreased in the hippocampus of negr1-/- mice compared to wild-type mice. Heterologous Lcn2 expression in the hippocampal DG of negr1-/- mice rescued anxiety- and depression-like behaviors and restored neurogenesis and mEPSC frequency to their normal levels in these mice. Furthermore, we discovered that Negr1 interacts with leukemia inhibitory factor receptor (LIFR) and modulates LIF-induced Lcn2 expression. Taken together, our data uncovered a novel mechanism of mood regulation by Negr1 involving an interaction between Negr1 and LIFR along with Lcn2 expression.