Neurotransmission requires precise control of neurotransmitter release from axon terminals. This process is regulated by glial cells; however, the underlying mechanisms are not fully understood. We found that glutamate release in the brain was impaired in mice lacking low-density lipoprotein receptor-related protein 4 (Lrp4), a protein that is critical for neuromuscular junction formation. Electrophysiological studies revealed compromised release probability in astrocyte-specific Lrp4 knockout mice. Lrp4 mutant astrocytes suppressed glutamatergic transmission by enhancing the release of ATP, whose level was elevated in the hippocampus of Lrp4 mutant mice. Consequently, the mutant mice were impaired in locomotor activity and spatial memory and were resistant to seizure induction. These impairments could be ameliorated by blocking the adenosine A1 receptor. The results reveal a critical role for Lrp4, in response to agrin, in modulating astrocytic ATP release and synaptic transmission. Our findings provide insight into the interaction between neurons and astrocytes for synaptic homeostasis and/or plasticity.