Synaptotagmin-IV (syt-IV) is a membrane trafficking protein that influences learning and memory, but its localization and role in synaptic function remain unclear. We found that syt-IV localized to brain-derived neurotrophic factor (BDNF)-containing vesicles in hippocampal neurons. Syt-IV/BDNF-harboring vesicles underwent exocytosis in both axons and dendrites, and syt-IV inhibited BDNF release at both sites. Knockout of syt-IV increased, and overexpression decreased, the rate of synaptic vesicle exocytosis from presynaptic terminals indirectly via changes in postsynaptic release of BDNF. Thus, postsynaptic syt-IV regulates the trans-synaptic action of BDNF to control presynaptic vesicle dynamics. Furthermore, selective loss of presynaptic syt-IV increased spontaneous quantal release, whereas a loss of postsynaptic syt-IV increased quantal amplitude. Finally, syt-IV knockout mice showed enhanced long-term potentiation (LTP), which depended entirely on disinhibition of BDNF release. Thus, regulation of BDNF secretion by syt-IV emerges as a mechanism for maintaining synaptic strength in a useful range during LTP.