Episodic memories are stored in distributed neurons but how eligibility of individual neurons to coding ensembles is determined remains elusive. We identified thousands of predominantly bistable (CpG methylated or unmethylated) regions within neuronal gene bodies, established during the development of the mouse hippocampal dentate gyrus. Reducing DNA methylation and the proportion of the methylated epialleles at bistable regions compromised novel context-induced neuronal activation and spatial memory. Conversely, increasing methylation and the frequency of the methylated epialleles at bistable regions enhanced intrinsic excitability and spatial memory but impaired spatial working memory, indicating that the developmentally established methylated-unmethylated epiallelic balance at bistable regions is essential for proper neuronal excitability and hippocampal cognitive functions. Single-nucleus profiling revealed the enrichment of specific epialleles from a subset of bistable regions, primarily exonic, in encoding neurons. We propose a model in which epigenetically bistable regions create neuron heterogeneity, and specific constellations of exonic epialleles dictate, via modulating neuronal excitability, eligibility to a coding ensemble.Bidirectional manipulation of the relative frequency of the methylated epialleles in vivo reduced and increased neuronal intrinsic excitability, novel context-induced neuronal activation, and hippocampal functions, linking methylation states and the combinations of these states, to neuronal eligibility to coding. Single-nucleus profiling of recently recruited neurons revealed enrichment for a set of epialleles that, via gene expression, may underlie eligibility for coding environmental inputs. Through these findings, our work implicates an epigenetic mechanisms dictating neuronal eligibility to recruitment, the first step of memory formation. Results:We found evidence for the developmental emergence of epigenetic heterogeneity in otherwise morphologically homogenous and genetically identical dorsal (d) DGCs in C57BL/6 male mice 15 .DGCs or their progenitors were microdissected from the granule cell layer of d (d) hippocampal slices at either embryonic day (E) 10.5, postnatal day (P) 6 or at 10-12 weeks of age, followed by enhanced RRBS methylation profiling of 1.5-2.5 million cytosines 16 (Fig. 1a). Loss and gain of methylation during the transition of P6 young DGCs (yDGCs) to adult DGCs produced 170,198 differentially methylated (DM) CpG sites (q<0.01, RRBS at >10x coverage, average change 22.23%). In adult DGCs, these DM CpGs were by and large not fully methylated and unmethylated but rather were in the state of intermediate methylation (IM, i.e. were methylated across the entire 0% to 100% range, Fig. 1c, pink). Many of these sites were already IM at P6 ( Fig. 1c, blue) indicating that the partial methylation/demethylation process began earlier.Indeed, comparing adult DGCs with cells from an earlier developmental stage, E10.5 hippocampal progenitors (HPs), still yielded DM sites ...