<p>OLM interneurons selectively target inhibition to the distal dendrites of CA1 pyramidal cells in the hippocampus but the role of this unique morphology in controlling place cell physiology remains a mystery. Here we show in mice that OLM activity prevents associative synaptic plasticity at Schaffer collateral synapses on CA1 pyramidal cells by inhibiting dendritic Ca²⁺ signalling initiated by entorhinal synaptic inputs. Furthermore, we find that OLM activity is reduced in novel environments suggesting that reducing OLM activity and thereby enhancing excitatory synaptic plasticity is important for the formation of new place cell representations. Supporting this, we show that selectively increasing OLM activity in novel environments enhances place cell stability and reduces remapping of newly formed place cells whilst increasing OLM activity in familiar environments led only to a transient silencing of place cells. Our results therefore demonstrate a critical role for distal dendrite targeting interneurons in regulating plasticity of neuronal representations.</p>