The granule cells of the dentate gyrus form the input stage of the hippocampal trisynaptic circuit and their function is strongly influenced by peptidergic systems. GPR54 is highly and discretely expressed in these cells. We have found that activation of GPR54 with kisspeptin-10 causes a rapid and large increase in the amplitude of excitatory synaptic responses in granule cells, without changing membrane properties. The effect was suppressed by the G-protein inhibitor GDP-beta-S and the calcium chelator BAPTA, and analysis of miniature EPSCs revealed an increase in mean amplitude but not event frequency, indicating that GPR54 and the mechanisms for enhancing EPSCs are postsynaptic, possibly involving changes in AMPA receptor number or conductance. The kisspeptin-induced synaptic potentiation was abolished by inhibitors of ERK1/2, tyrosine kinase, and CaMKII. RT-PCR experiments showed that KiSS-1 is expressed in the dentate gyrus. KiSS-1 mRNA was significantly increased by seizure activity in rats and when neuronal activity in organotypic hippocampal slice cultures was enhanced by kainate or picrotoxin, while mRNA for GPR54 remained essentially unchanged. These results suggest that kisspeptin may be locally synthesized and act as an autocrine factor. In separate experiments, hippocampal KiSS-1 mRNA in male rats was increased after gonadectomy. In summary, kisspeptin is a novel endogenous factor which is dynamically regulated by neuronal activity and which, in marked distinction from other neuropeptides, increases synaptic transmission in dentate granule cells through signaling cascades possibly linked to the MAP kinase system. This novel peptide system may play a role in cognition and in the pathogenesis of epilepsy.