The neural cell adhesion molecule NCAM and its associated polysialic acid (PSA) play important roles in synaptic plasticity in the CA1 and/or CA3 regions of the hippocampus in vitro. Here, we address the question of whether NCAM and PSA are involved in regulation of synaptic transmission and plasticity also in vivo at synapses formed by entorhinal cortex axons in the dentate gyrus of mice anaesthetized with urethane. We show that basal synaptic transmission, measured as the slope of field excitatory postsynaptic potentials, was reduced strongly in mice lacking ST8SiaII/STX, the enzyme involved in polysialylation of NCAM in stem cell-derived immature granule cells, but not in mice deficient either in the NCAM glycoprotein or the enzyme ST8SiaIV/PST involved in polysialylation of NCAM in mature neurons. Strikingly, only mice deficient in NCAM, but not in PST or STX, were impaired in long-term potentiation (LTP) induced by theta-burst stimulation, suggesting that LTP in the dentate gyrus depends on the NCAM glycoprotein alone rather than on its associated PSA. As also patterns of synaptic activity during and immediately after induction of LTP were impaired in NCAM-deficient mice, it is likely that induction of LTP requires NCAM. These data are the first to describe that NCAM is necessary for induction of synaptic plasticity in identified synapses in vivo and suggest that polysialylation of NCAM expressed by immature granule cells in the dentate gyrus supports development of basal excitatory synaptic transmission in this region.