The dentate gyrus-CA3 circuit of the hippocampus is continuously modified by the integration of adult-born dentate granule cells (abDGCs). All abDGCs undergo a prolonged period of maturation, during which they exhibit heightened synaptic plasticity and refinement of electrophysiological properties and connectivity. Consistent with theoretical models and the known functions of the dentate gyrus-CA3 circuit, acute or chronic manipulations of abDGCs support a role for abDGCs in the regulation of memory interference. In this Review, we integrate insights from studies that examine the maturation of abDGCs and their integration into the circuit with network mechanisms that support memory discrimination, consolidation and clearance. We propose that adult hippocampal neurogenesis enables the generation of a library of experiences, each registered in mature abDGC physiology and connectivity. Mature abDGCs recruit inhibitory microcircuits to support pattern separation and memory indexing.