Synapsin III is the most recently identified member of the synapsin family, a group of synaptic vesicle proteins that play essential roles in neurotransmitter release and neurite outgrowth. Here, through the generation and analysis of synapsin III knock-out mice, we demonstrate that synapsin III regulates neurotransmitter release in a manner that is distinct from that of synapsin I or synapsin II. In mice lacking synapsin III, the size of the recycling pool of synaptic vesicles was increased, and synaptic depression was reduced. The number of vesicles that fuse per action potential was similar between synapsin III knock-out and wild-type mice, and there was no change in the quantal content of EPSCs; however, IPSCs were greatly reduced in synapsin III-deficient neurons. The density and distribution of synaptic vesicles in presynaptic terminals did not appear to be different in synapsin III knock-out mice in comparison to wild-type littermates. In addition to the changes in neurotransmitter release, we observed a specific delay in axon outgrowth in cultured hippocampal neurons from synapsin III knock-out mice. Our data indicate that synapsin III plays unique roles both in early axon outgrowth and in the regulation of synaptic vesicle trafficking.