Neuroligin (NLG), a postsynaptic adhesion molecule, is involved in the formation of synapses by binding to a cognate presynaptic ligand, neurexin. Here we report that neuroligin-1 (NLG1) undergoes ectodomain shedding at the juxtamembrane stalk region to generate a secreted form of NLG1 and�a membrane-tethered C-terminal fragment (CTF) in adult rat brains in�vivo as well as in neuronal cultures. Pharmacological and genetic studies identified ADAM10 as the major protease responsible for NLG1 shedding, the latter being augmented by synaptic NMDA receptor activation or interaction with soluble neurexin ligands. NLG1-CTF was subsequently cleaved by presenilin/γ-secretase. Secretion of soluble NLG1 was significantly upregulated under a prolonged epileptic seizure condition, and inhibition of NLG1 shedding led to an increase in numbers of dendritic spines in neuronal cultures. Collectively, neuronal activity-dependent proteolytic processing of NLG1 may negatively regulate the remodeling of spines at excitatory synapses.