Major depressive disorder (MDD) affects up to 17% of the population, causing profound personal suffering and economic loss. Clinical and preclinical studies have revealed that prolonged stress and MDD are associated with neuronal atrophy of cortical and limbic brain regions, but the molecular mechanisms underlying these morphological alterations have not yet been identified. Here, we show that stress increases levels of REDD1 (regulated in development and DNA damage responses-1), an inhibitor of mTORC1 (mammalian target of rapamycin complex-1; ref. 10), in rat prefrontal cortex (PFC). This is concurrent with a decrease in phosphorylation of signaling targets of mTORC1, which is implicated in protein synthesis-dependent synaptic plasticity. We also found that REDD1 levels are increased in the postmortem PFC of human subjects with MDD relative to matched controls. Mutant mice with a deletion of the gene encoding REDD1 are resilient to the behavioral, synaptic and mTORC1 signaling deficits caused by chronic unpredictable stress, whereas viral-mediated overexpression of REDD1 in rat PFC is sufficient to cause anxiety- and depressive-like behaviors and neuronal atrophy. Taken together, these postmortem and preclinical findings identify REDD1 as a critical mediator of the atrophy of neurons and depressive behavior caused by chronic stress exposure.