Mood disorders are common, recurrent and disabling illnesses which are frequently associated with hypothalamic-pituitary-adrenal (HPA) axis dysregulation and memory loss. The hippocampus provides negative feedback to the HPA axis and has an important role in key aspects of spatial and declarative memory. Thus, hippocampal dysfunction could account for both the memory impairment and neuroendocrine abnormalities found in mood disorders. The critical role of the hippocampus in declarative memory, emotional processing, and vulnerability to stress has been demonstrated in both animal and human studies. Cellular processes in the hippocampus including long-term potentiation, neurogenesis, and dendritic remodeling are currently areas of intense study. Human studies report cognitive impairment consistent with hippocampal dysfunction in depression, bipolar disorder, Cushing's disease, and in those individuals receiving exogenous corticosteroids. This review examines data on the role of corticosteroids in hippocampal remodeling and atrophy in patients with mood disorders. Interventions to prevent or reverse the damaging effects of corticosteroids on the hippocampus are discussed.