Sp4, a member of the Sp1 family of transcription factors, is expressed restrictively in the developing nervous system and abundantly in the hippocampus. Previously, we demonstrated that hypomorphic Sp4 mice display hippocampal vacuolization and concomitant deficits in memory and sensorimotor gating. Here, we report further analyses of Sp4 functions during postnatal development of the dentate gyrus in Sp4 null mutant mice. A reduced cell proliferation restrictively in hippocampus, but not cerebellum, was observed in the first week of postnatal development of Sp4 null mutant mice. The dendritic growth and arborization of dentate granule cells was decreased in hippocampal cultures in vitro from mutant neonatal mice. The adult Sp4 null mutant mice displayed decreased dentate granule cell density with reduced width of both dentate gyrus and the molecular layer. The abnormality of the molecular layer was indicated by a reduced level of synaptophysin expression in the mutant mice. The Sp4 transcription factor therefore appears to predominantly regulate the development of dentate granule cells.