Communication within the nervous system is mediated by Ca2+-triggered fusion of synaptic vesicles with the presynaptic plasma membrane. Genetic and biochemical evidence indicates that synaptotagmin I may function as a Ca2+ sensor in neuronal exocytosis because it can bind Ca2+ and penetrate into lipid bilayers. Chronic depolarization or seizure activity results in the upregulation of a distinct and unusual isoform of the synaptotagmin family, synaptotagmin IV. We have identified a Drosophila homologue of synaptotagmin IV that is enriched on synaptic vesicles and contains an evolutionarily conserved substitution of aspartate to serine that abolishes its ability to bind membranes in response to Ca2+ influx. Synaptotagmin IV forms hetero-oligomers with synaptotagmin I, resulting in synaptotagmin clusters that cannot effectively penetrate lipid bilayers and are less efficient at coupling Ca2+ to secretion in vivo: upregulation of synaptotagmin IV, but not synaptotagmin I, decreases evoked neurotransmission. These findings indicate that modulating the expression of synaptotagmins with different Ca2+-binding affinities can lead to heteromultimers that can regulate the efficiency of excitation-secretion coupling in vivo and represent a new molecular mechanism for synaptic plasticity.