The neuropeptide somatostatin (SST) is expressed in a discrete population of interneurons in the dentate gyrus. These interneurons have their soma in the hilus and project to the outer molecular layer onto dendrites of dentate granule cells, adjacent to perforant path input. SST-containing interneurons are very sensitive to excitotoxicty, and thus are vulnerable to a variety of neurological diseases and insults, including epilepsy, Alzheimer's disease, traumatic brain injury, and ischemia. The SST gene contains a prototypical cyclic AMP response element (CRE) site. Such a regulatory site confers activity-dependence to the gene, such that it is turned on when neuronal activity is high. Thus SST expression is increased by pathological conditions such as seizures and by natural stimulation such as environmental enrichment. SST may play an important role in cognition by modulating the response of neurons to synaptic input. In the dentate, SST and the related peptide cortistatin (CST) reduce the likelihood of generating long-term potentiation, a cellular process involved in learning and memory. Thus these neuropeptides would increase the threshold of input required for acquisition of new memories, increasing "signal to noise" to filter out irrelevant environmental cues. The major mechanism through which SST inhibits LTP is likely through inhibition of voltage-gated Ca(2+) channels on dentate granule cell dendrites. Transgenic overexpression of CST in the dentate leads to profound deficits in spatial learning and memory, validating its role in cognitive processing. A reduction of synaptic potentiation by SST and CST in dentate may also contribute to the well-characterized antiepileptic properties of these neuropeptides. Thus SST and CST are important neuromodulators in the dentate gyrus, and disruption of this signaling system may have major impact on hippocampal function.