The hippocampus, a critical brain structure for navigation, context-dependent learning and episodic memory, is composed of anatomically heterogeneous subregions. These regions differ in their anatomical inputs as well as in their internal circuitry. A major feature of the CA3 region is its recurrent collateral circuitry, by which the CA3 pyramidal cells make excitatory synaptic contacts on each other. In contrast, pyramidal cells in the CA1 region are not extensively interconnected. Although these differences have inspired numerous theoretical models of differential processing capacities of these two regions, there have been few reports of robust differences in the firing properties of CA1 and CA3 neurons in behaving animals. The most extensively studied of these properties is the spatially selective firing of hippocampal 'place cells'. Here we report that in a dynamically changing environment, in which familiar landmarks on the behavioural track and along the wall are rotated relative to each other, the population representation of the environment is more coherent between the original and cue-altered environments in CA3 than in CA1. These results demonstrate a functional heterogeneity between the place cells of CA3 and CA1 at the level of neural population representations.