Brain derived neurotrophic factor (BDNF) is a major neurotransmitter that controls growth and maintenance of neurons and its misregulation is linked to neurodegeneration and human diseases. Estradiol (E2) is well-known to regulate the process of differentiation and plasticity of hippocampal neurons. Here we examined the mechanisms of BDNF gene regulation under basal conditions and under stimuli such as E2. Our results demonstrated that BDNF expression is induced by E2 in vitro in HT22 cells (hippocampal neuronal cells) and in vivo (in ovariectomized mouse brain under E2-treatment). Using chromatin immunoprecipitation assay, we demonstrated that estrogen receptors (ERα, ERβ) were enriched at the BDNF promoter in presence of E2. Additionally, ER-coregulators (e.g., CBP/p300, MLL3), histone acetylation, H3K4-trimethylation, and RNA polymerase II levels were also elevated at the BDNF promoter in an E2-dependent manner. Additionally, under the basal conditions (in the absence of E2), the long noncoding RNA HOTAIR and its interacting partners PRC2 and LSD1 complexes binds to the promoter of BDNF and represses its expression. HOTAIR knockdown -relieves the repression resulting in elevation of BDNF expression. Further, levels of HOTAIR-interacting partners, EZH2 and LSD1 were reduced at the BDNF promoter upon HOTAIR-knockdown revealing that HOTAIR plays a regulatory role in BDNF gene expression by modulating promoter histone modifications. Additionally, we showed that E2 induced-BDNF expression is mediated by the displacement of silencing factors, EZH2 and LSD1 at BDNF promoter and subsequent recruitment of active transcription machinery. These results reveal the mechanisms of BDNF gene regulation under the basal condition and in presence of a positive regulator such as E2 in neuronal cells.