Everyday episodic memories involve linking together related events that are temporally separated. However, the mechanisms of forming this temporal association have remained unclear. Here, using astrocyte-specific manipulations, we show that potentiating astrocyte Ca2+ signaling in the hippocampal cornu ammonis 1 (CA1) enhances the strength of such temporal association, in parallel with long-term potentiation (LTP) enhancement of temporoammonic pathway to CA1, whereas attenuation of astrocyte Ca2+ signaling has the opposite effect. Moreover, we identify that these effects are mediated by astrocytic α4 subunit-containing nicotinic acetylcholine receptors (α4-nAChRs) via mechanisms involving NMDAR co-agonist supply. Finally, astrocytic α4-nAChRs underlie the cognitive enhancer nicotine's physiological effects. Together, these findings highlight the importance of astrocyte Ca2+ signaling in cognitive behavior and reveal a mechanism in governing the temporal association of episodic memory formation that operates through α4-nAChRs on hippocampal astrocytes.