SORCS3 is an orphan receptor of the VPS10P domain receptor family, a group of sorting and signaling receptors central to many pathways in control of neuronal viability and function. SORCS3 is highly expressed in the CA1 region of the hippocampus, but the relevance of this receptor for hippocampal activity remained absolutely unclear. Here, we show that SORCS3 localizes to the postsynaptic density and that loss of receptor activity in gene-targeted mice abrogates NMDA receptor-dependent and -independent forms of long-term depression (LTD). Consistent with a loss of synaptic retraction, SORCS3-deficient mice suffer from deficits in behavioral activities associated with hippocampal LTD, particularly from an accelerated extinction of fear memory. A possible molecular mechanism for SORCS3 in synaptic depression was suggested by targeted proteomics approaches that identified the ability of SORCS3 to functionally interact with PICK1, an adaptor that sorts glutamate receptors at the postsynapse. Faulty localization of PICK1 in SORCS3-deficient neurons argues for altered glutamate receptor trafficking as the cause of altered synaptic plasticity in the SORCS3-deficient mouse model. In conclusion, our studies have identified a novel function for VPS10P domain receptors in control of synaptic depression and suggest SORCS3 as a novel factor modulating aversive memory extinction.