When circulating estrogen levels decline as a natural consequence of menopause and aging in women, there is an increased incidence of deficits in working memory. In many cases, these deficits are rescued by estrogen replacement therapy. These clinical data therefore highlight the importance of defining the biological pathways linking estrogen to the cellular substrates of learning and memory. It has been known for nearly two decades that estrogen enhances dendritic spine density on apical dendrites of CA1 pyramidal cells in hippocampus, a brain region required for learning. Interestingly, at synapses between CA3–CA1 pyramidal cells, estrogen has also been shown to enhance synaptic NMDA receptor current and the magnitude of long-term potentiation, a cellular correlate of learning and memory. Given that synapse density, NMDAR function, and long-term potentiation at CA3–CA1 synapses in hippocampus are associated with normal learning, it is likely that modulation of these parameters by estrogen facilitates the improvement in learning observed in rats, primates and humans following estrogen replacement. To facilitate the design of clinical strategies to potentially prevent or reverse the age-related decline in learning and memory during menopause, the relationship between the estrogen-induced morphological and functional changes in hippocampus must be defined and the role these changes play in facilitating learning must be elucidated. The aim of this report is to provide a summary of the proposed mechanisms by which this hormone increases synaptic function and in doing so, it briefly addresses potential mechanisms contributing to the estrogen-induced increase in synaptic morphology and plasticity, as well as important future directions.