Anatomical and physiological compartmentalization of neurons is a mechanism to increase the computational capacity of a circuit, and a major question is what role axonal compartmentalization plays. Axonal compartmentalization may enable localized, presynaptic plasticity to alter neuronal output in a flexible, experience-dependent manner. Here, we show that olfactory learning generates compartmentalized, bidirectional plasticity of acetylcholine release that varies across the longitudinal compartments of Drosophila mushroom body (MB) axons. The directionality of the learning-induced plasticity depends on the valence of the learning event (aversive vs. appetitive), varies linearly across proximal to distal compartments following appetitive conditioning, and correlates with learning-induced changes in downstream mushroom body output neurons (MBONs) that modulate behavioral action selection. Potentiation of acetylcholine release was dependent on the CaV2.1 calcium channel subunit cacophony. In addition, contrast between the positive conditioned stimulus and other odors required the inositol triphosphate receptor, which maintained responsivity to odors upon repeated presentations, preventing adaptation. Downstream from the MB, a set of MBONs that receive their input from the γ3 MB compartment were required for normal appetitive learning, suggesting that they represent a key node through which reward learning influences decision-making. These data demonstrate that learning drives valence-correlated, compartmentalized, bidirectional potentiation, and depression of synaptic neurotransmitter release, which rely on distinct mechanisms and are distributed across axonal compartments in a learning circuit.