Although most neurons are generated embryonically, neurogenesis is maintained at low rates in specific brain areas throughout adulthood, including the dentate gyrus of the mammalian hippocampus. Episodic-like memories encoded in the hippocampus require the dentate gyrus to decorrelate similar experiences by generating distinct neuronal representations from overlapping inputs (pattern separation). Adult-born neurons integrating into the dentate gyrus circuit compete with resident mature cells for neuronal inputs and outputs, and recruit inhibitory circuits to limit hippocampal activity. They display transient hyperexcitability and hyperplasticity during maturation, making them more likely to be recruited by any given experience. Behavioral evidence suggests that adult-born neurons support pattern separation in the rodent dentate gyrus during encoding, and they have been proposed to provide a temporal stamp to memories encoded in close succession. The constant addition of neurons gradually degrades old connections, promoting generalization and ultimately forgetting of remote memories in the hippocampus. This makes space for new memories, preventing saturation and interference. Overall, a small population of adult-born neurons appears to make a unique contribution to hippocampal information encoding and removal. Although several inconsistencies regarding the functional relevance of neurogenesis remain, in this review we argue that immature neurons confer a unique form of transience on the dentate gyrus that complements synaptic plasticity to help animals flexibly adapt to changing environments.