The mechanisms by which synapse assembly and maturation are orchestrated during development are largely unknown. We used P-element mutagenesis and a larval anatomical screen to isolate mutants in which synapse structure was altered. Here, we describe a mutation isolated with this screen, branch point disrupted (bpd), in which both synapse specificity and synapse morphology were altered. Synaptic terminals in bpd mutants developed abnormally, forming multiple branch points, overgrowing to inappropriate neighboring muscles, and establishing aberrant folding of postsynaptic membranes. Ultrastructural characterization of synaptic boutons in bpd demonstrated abnormal layering of the postsynaptic specialization or subsynaptic reticulum (SSR). Genetic and molecular analyses revealed that bpd is an allele of mod(mdg4), a gene coding for a protein with many similarities to transcription factors, which has been implicated in the regulation of chromatin insulation. Our results suggest that mod(mdg4) may regulate a gene(s) essential to normal synapse formation.