Arc/Arg3.1 is an immediate-early gene whose expression levels are increased by strong synaptic activation, including synapse-strengthening activity patterns. Arc/Arg3.1 mRNA is transported to activated dendritic regions, conferring the distribution of Arc/Arg3.1 protein both temporal correlation with the inducing stimulus and spatial specificity. Here, we investigate the effect of increased Arc/Arg3.1 levels on synaptic transmission. Surprisingly, Arc/Arg3.1 reduces the amplitude of synaptic currents mediated by AMPA-type glutamate receptors (AMPARs). This effect is prevented by RNAi knockdown of Arc/Arg3.1, by deleting a region of Arc/Arg3.1 known to interact with endophilin 3 or by blocking clathrin-coated endocytosis of AMPARs. In the hippocampal slice, Arc/Arg3.1 results in removal of AMPARs composed of GluR2 and GluR3 subunits (GluR2/3). Finally, Arc/Arg3.1 expression occludes NMDAR-dependent long-term depression. Our results demonstrate that Arc/Arg3.1 reduces the number of GluR2/3 receptors leading to a decrease in AMPAR-mediated synaptic currents, consistent with a role in the homeostatic regulation of synaptic strength.