To investigate the roles phosphatases play in hippocampal-dependent memory, we studied transgenic mice overexpressing a truncated form of calcineurin. These mice have normal short-term memory but defective long-term memory evident on both a spatial task and on a visual recognition task, providing genetic evidence for the role of the rodent hippocampus in spatial and nonspatial memory. The defect in long-term memory could be fully rescued by increasing the number of training trials, suggesting that the mice have the capacity for long-term memory. We next analyzed mice overexpressing calcineurin in a regulated manner and found the memory defect is reversible and not due to a developmental abnormality. Our behavioral results suggest that calcineurin has a role in the transition from short- to long-term memory, which correlates with a novel intermediate phase of LTP.