Depression has been associated with reduced expression of brain-derived neurotrophic factor (BDNF) in the hippocampus. In addition, animal studies suggest an association between reduced hippocampal neurogenesis and depressive-like behavior. These associations were predominantly established based on responses to antidepressant drugs and alterations in BDNF levels and neurogenesis in depressive patients or animal models for depressive behavior. Nevertheless, there is no direct evidence that the actual reduction of the BDNF protein in specific brain sites can induce depressive-like behaviors or affect neurogenesis in vivo. Using BDNF knockdown by RNA interference and lentiviral vectors injected into specific subregions of the hippocampus we show that a reduction in BDNF expression in the dentate gyrus, but not the CA3, reduces neurogenesis and affects behaviors associated with depression. Moreover, we show that BDNF has a critical function in neuronal differentiation, but not proliferation in vivo. Finally, we found that a specific BDNF knockdown in the ventral subiculum induces anhedonic-like behavior. These findings provide substantial support for the neurotrophic hypothesis of depression and specify anatomical and neurochemical targets for potential antidepressant interventions. Moreover, the specific effect of BDNF reduction on neuronal differentiation has broader implications for the study of neurodevelopment and neurodegenerative diseases.