Both excitatory and inhibitory synapses are subject to activity-dependent changes that are crucial for experience-driven refinement of neuronal circuits such as take place during development and memory formation. Pre-, post-, and hetero-synaptic pathways have been implicated in synaptic plasticity, although the molecular processes underlying heterosynaptic plasticity are quite poorly understood relative to the well-studied homosynaptic long-term potentiation (LTP) and long-term depression (LTD) of excitatory synapses in the CAI region of the hippocampus. A recently identified form of heterosynaptic plasticity was observed in which LTP stimulation produced depression at inhibitory synapses through presynaptic changes. What effect LTD induction has on inhibitory synapses and whether postsynaptic mechanisms contribute to heterosynaptic plasticity are critical unanswered questions. Combining biochemical, electrophysiological, and cellular and molecular biological approaches, I present in this thesis evidence of a novel pathway in which an LTD pattern of NMDA receptor activation initiates trafficking of inhibitory GABA_A receptors to inhibitory synapses in hippocampal neurons. This increase in GABA_A receptors enhances inhibitory synaptic strength and requires Ca²⁺ and CaMKII, similar to excitatory LTP. The common requirement of Ca²⁺ and CaMKII for inhibitory and excitatory LTP raises an important question as to how potentiation is limited to one set of synapses. Hypothesizing that CaMKII localization may be important, I show for the first time that CaMKII, whose translocation to excitatory synapses is well-established, also translocates to inhibitory synapses. Furthermore, I demonstrate that translocation is synapse- and stimulus-specific: stimuli that potentiate excitatory synapses cause translocation to excitatory synapses while those that trigger inhibitory synaptic potentiation induce CaMKII targeting only to inhibitory synapses. In addition I have identified previously unknown roles for the proteins NSF, GABARAP, and GRIP in NMDA receptor-mediated trafficking of GABA_A receptors. I present a model in which NMDA receptor activation causes GABARAP to bind to GABA_A receptors and chaperone them to GRIP-containing inhibitory synapses, where upon binding to NSF they are inserted into the membrane. By simultaneously strengthening inhibitory synapses and weakening excitatory synapses with a single glutamatergic stimulus, this pathway expands the computational power of neuronal circuits and may also provide a target for therapeutic intervention in diseases of excitability.