The hippocampal formation, a structure involved in declarative, spatial and contextual memory, is a particularly sensitive and vulnerable brain region to stress and stress hormones. The hippocampus shows a considerable degree of structural plasticity in the adult brain. Stress suppresses neurogenesis of dentate gyrus granule neurons, and repeated stress causes atrophy of dendrites in the CA3 region. In addition, ovarian steroids regulate synapse formation during the estrous cycle of female rats. All three forms of structural remodeling of the hippocampus are mediated by hormones working in concert with excitatory amino acids (EAA) and N-methyl-D-aspartate (NMDA) receptors. EAA and NMDA receptors are also involved in neuronal death that is caused in pyramidal neurons by seizures and by ischemia and prolonged psychosocial stress. In the human hippocampus, magnetic resonance imaging studies have shown that there is a selective atrophy in recurrent depressive illness, accompanied by deficits in memory performance. Hippocampal atrophy may be a feature of affective disorders that is not treated by all medications. From a therapeutic standpoint, it is essential to distinguish between permanent damage and reversible atrophy in order to develop treatment strategies to either prevent or reverse deficits. In addition, remodeling of brain cells may occur in other brain regions. Possible treatments are discussed. Copyright 2001 John Wiley & Sons, Ltd.