Synaptic cadherin adhesion complexes are known to be key regulators of synapse plasticity. However, the molecular mechanisms that coordinate activity-induced modifications in cadherin localization and adhesion and the subsequent changes in synapse morphology and efficacy remain unknown. We demonstrate that the intracellular cadherin binding protein δ-catenin is transiently palmitoylated by DHHC5 after enhanced synaptic activity and that palmitoylation increases δ-catenin-cadherin interactions at synapses. Both the palmitoylation of δ-catenin and its binding to cadherin are required for activity-induced stabilization of N-cadherin at synapses and the enlargement of postsynaptic spines, as well as the insertion of GluA1 and GluA2 subunits into the synaptic membrane and the concomitant increase in miniature excitatory postsynaptic current amplitude. Notably, context-dependent fear conditioning in mice resulted in increased δ-catenin palmitoylation, as well as increased δ-catenin-cadherin associations at hippocampal synapses. Together these findings suggest a role for palmitoylated δ-catenin in coordinating activity-dependent changes in synaptic adhesion molecules, synapse structure and receptor localization that are involved in memory formation.