The dentate gyrus (DG) is one of two brain regions acknowledged to sustain neural stem cells (NSCs) continuously producing neurons (termed “neurogenesis”) beyond development. Newborn neurons produced in the DG are involved in hippocampal-dependent learning and memory. Thus, factors regulating establishment of the NSC pool during development and their life-long maintenance are crucial for hippocampal function. The fate of NSCs is governed by local microenvironmental factors, including neural circuit activity. Hyperexcitation in the hippocampus caused by epileptic seizures aberrantly increases neurogenesis in the adult DG, leading to consumption of many NSCs and results in exhaustion of the NSC pool. Despite accumulating evidence that neuronal activity regulates NSCs dynamics, still little is known about the responsible niche cells and signaling molecules connecting neural activity and NSC dynamics. Similar to the adult DG, NSCs in the developing DG may also be influenced by activity, but whether NSCs are regulated by early neural activity during circuit establishment in the developing DG has not been directly addressed. In the previous funding cycle for this grant, we found that Shh is a key niche signal for the initial production of specialized NSCs populating the DG and for their postnatal expansion to establish the size of the NSC pool for later adult neurogenesis. In more recent preliminary data we have found that Shh signaling is upregulated after seizures in the adult DG and that seizure-induced aberrant neurogenesis is attenuated in Shh deficient mice. We previously showed that Shh is produced from excitatory neurons in the dentate hilus (mossy cells) but have now extended this to show that mossy cell activity enhances neurogenesis. On this basis we have formulated the hypothesis (for Aim 1) that Shh derived from mossy cells is crucial for neuronal activity induced DG neurogenesis. We have also investigated the neuronal circuit in the developing DG and found that the entorhinal cortex projection to the developing DG is established by the first postnatal week coinciding with the appearance of quiescent NSCs in the DG. We have also found that NSCs receive direct inputs from local neurons in the developing DG in this same period. Based on these preliminary results we formulated a second hypothesis (for Aim 2) that development of cortex-dentate-NSCs circuits and their activity control the proliferation state and transition to quiescence of NSCs in the developing DG.