Brain-derived neurotrophic factor (BDNF) plays an important role in synaptic plasticity but the underlying signaling mechanisms remain unknown. Here, we show that BDNF rapidly recruits full-length TrkB (TrkB-FL) receptor into cholesterol-rich lipid rafts from nonraft regions of neuronal plasma membranes. Translocation of TrkB-FL was blocked by Trk inhibitors, suggesting a role of TrkB tyrosine kinase in the translocation. Disruption of lipid rafts by depleting cholesterol from cell surface blocked the ligand-induced translocation. Moreover, disruption of lipid rafts prevented potentiating effects of BDNF on transmitter release in cultured neurons and synaptic response to tetanus in hippocampal slices. In contrast, lipid rafts are not required for BDNF regulation of neuronal survival. Thus, ligand-induced TrkB translocation into lipid rafts may represent a signaling mechanism selective for synaptic modulation by BDNF in the central nervous system.