The gyrus dentatus is one of the few areas of the brain that continues to produce neurons after birth. The newborn cells differentiate into granule cells which project axons to their postsynaptic targets. This step is accompanied by the transient expression of the polysialylated isoforms of neuronal cell adhesion molecules (PSA-NCAM) by the developing neurons. Glucocorticoid hormones have been shown to inhibit neurogenesis. We noted a functional correlation between PSA-NCAM expression and glucocorticoid action after manipulation of corticosterone levels in the adrenalectomized rat. Adrenalectomy increased neurogenesis, evaluated from the incorporation of 5-bromo-2'-deoxyuridine in neuronal precursors, as well as PSA-NCAM expression. The increase in PSA-NCAM-immunoreactive (IR) cells in the gyrus dentatus, evidenced 72 h following adrenalectomy, persisted for at least a month. It was accompanied by enhanced dendritic arborization of PSA-NCAM-IR cells in the gyrus dentatus and by an increase in number of PSA-NCAM-IR fibres in the CA3 subfield. Neurogenesis was normalized by restitution of diurnal or nocturnal levels of corticosterone, whereas normalization of PSA-NCAM expression was only observed after simulation of the complete circadian fluctuation of the hormone. Our findings reveal the complex action of corticosterone in modulating the expression of PSA-NCAM in the gyrus dentatus of the hippocampal formation. They also highlight the importance of corticosterone fluctuations in the control of neurogenesis and plasticity in this structure.