The amyloid precursor protein (APP) harbors physiological roles at synapses and is central to Alzheimer's disease (AD) pathogenesis. Evidence suggests that APP intracellular domain (AICD) could regulate synapse function, but the underlying molecular mechanisms remain unknown. We addressed AICD actions at synapses, per se, combining in vivo AICD expression, ex vivo AICD delivery or APP knock-down by in utero electroporation of shRNAs with whole-cell electrophysiology. We report a critical physiological role of AICD in controlling GIuN2B-containing NMDA receptors (NMDARs) at immature excitatory synapses, via a transcription-dependent mechanism. We further show that AICD increase in mature neurons, as reported in AD, alters synaptic NMDAR composition to an immature-like GIuN2B-rich profile. This disrupts synaptic signal integration, via over-activation of SK channels, and synapse plasticity, phenotypes rescued by GIuN2B antagonism. We provide a new physiological role for AICD, which becomes pathological upon AICD increase in mature neurons. Thus, AICD could contribute to AD synaptic failure.