We previously identified Neuregulin1 (NRG1) as a gene contributing to the risk of developing schizophrenia. Furthermore, we showed that NRG1+/- mutant mice display behavioral abnormalities that are reversed by clozapine, an atypical antipsychotic drug used for the treatment of schizophrenia. We now present evidence that ErbB4 (v-erb-a erythroblastic leukemia viral oncogene homolog 4), the tyrosine kinase receptor for NRG1 in hippocampal neurons, interacts with two nonreceptor tyrosine kinases, Fyn and Pyk2 (proline-rich tyrosine kinase 2). NRG1 stimulation of cells expressing ErbB4 and Fyn leads to the association of Fyn with ErbB4 and consequent activation. Furthermore, we show that NRG1 signaling, through activation of Fyn and Pyk2 kinases, stimulates phosphorylation of Y1472 on the NR2B subunit of the NMDA receptor (NMDAR), a key regulatory site that modulates channel properties. NR2B Y1472 is hypophosphorylated in NRG1+/- mutant mice, and this defect can be reversed by clozapine at a dose that reverses their behavioral abnormalities. We also demonstrate that short-term synaptic plasticity is altered and theta-burst long-term potentiation is impaired in NRG1+/- mutant mice, and incubation of hippocampal slices from these mice with NRG1 reversed those effects. Attenuated NRG1 signaling through ErbB4 may contribute to the pathophysiology of schizophrenia through dysfunction of NMDAR modulation. Thus, our data support the glutamate hypothesis of schizophrenia.