To determine how hippocampal backprojections influence spatially periodic firing in grid cells, we recorded neural activity in the medial entorhinal cortex (MEC) of rats after temporary inactivation of the hippocampus. We report two major changes in entorhinal grid cells. First, hippocampal inactivation gradually and selectively extinguished the grid pattern. Second, the same grid cells that lost their grid fields acquired substantial tuning to the direction of the rat's head. This transition in firing properties was contingent on a drop in the average firing rate of the grid cells and could be replicated by the removal of an external excitatory drive in an attractor network model in which grid structure emerges by velocity-dependent translation of activity across a network with inhibitory connections. These results point to excitatory drive from the hippocampus, and possibly other regions, as one prerequisite for the formation and translocation of grid patterns in the MEC.