The administration of exogenous insulin into the hippocampus has the potential to enhance cognitive function and exert other beneficial effects. Elucidating the neurobiological substrates of insulin action and its underlying physiological mechanisms may further improve treatment efficacy. Previous work has shown that insulin affects synaptic plasticity, however there are discrepancies and contradictory conclusions between studies. Here, we used extracellular field recordings in mouse hippocampal slices to investigate how insulin acutely modulates synaptic transmission and synaptic plasticity, both of which are correlated with learning and memory processes. Our data demonstrate that insulin application inhibited basal excitatory synaptic transmission and promoted long-term potentiation (LTP) induction at hippocampal Schaffer collateral-CA1 synapses. Under similar conditions, insulin strongly activated the PI3K/AKT pathway, but had only a weak effect on the MAPK/ERK pathway. Although insulin-induced inhibition of field excitatory post-synaptic potentials (fEPSPs) was previously termed insulin-long-term depression (insulin-LTD), insulin application potentiated recovery from classically induced LTD. Further analysis suggests suppression of presynaptic neurotransmitter release contributed to the insulin-LTD. At low concentrations, insulin primarily inhibited fEPSPs; however, at high concentration, its effects were of mixed inhibition and enhancement in different recordings. Moreover, a broad spectrum protein kinase C blocker, cannabinoid receptor type 1 activator, or a high glucose concentration inhibited fEPSPs per se, and disturbed insulin's effect on fEPSP. Insulin also caused depotentiation during LTP expression and triggered depression during LTD recovery. Given the essential roles of dynamic synaptic transmission and plasticity in learning and memory, our data provide more evidence that insulin application may actively modulate hippocampal-dependent cognitive events.