Emerging evidence indicates that liquid-liquid phase separation, the formation of a condensed molecular assembly within another diluted aqueous solution, is a means for cells to organize highly condensed biological assemblies (also known as biological condensates or membraneless compartments) with very broad functions and regulatory properties in different subcellular regions. Molecular machineries dictating synaptic transmissions in both presynaptic boutons and postsynaptic densities of neuronal synapses may be such biological condensates. Here we review recent developments showing how phase separation can build dense synaptic molecular clusters, highlight unique features of such condensed clusters in the context of synaptic development and signaling, discuss how aberrant phase-separation-mediated synaptic assembly formation may contribute to dysfunctional signaling in psychiatric disorders, and present some challenges and opportunities of phase separation in synaptic biology.