A large number of neuropeptides and neurotransmitters stimulate neuronal cells through the second messenger cAMP. These synaptic signals often cause profound changes in neuronal function by altering basic patterns of gene expression. Cyclic AMP, in turn, regulates a number of these genes through a conserved cAMP response element (CRE). Recently, a nuclear CRE-binding protein, CREB, has been shown to bind to the CRE and stimulate the transcription of cAMP-responsive genes. This article reviews recent progress towards understanding the mechanism by which cAMP modulates the activity of CREB to stimulate gene transcription.