Phosphatase and tensin homolog deleted on chromosome 10 (PTEN) α is the first identified isoform of the well‐known tumor suppressor PTEN. PTENα has an evolutionarily conserved 173‐aa N terminus compared with canonical PTEN. Recently, PTENα has been shown to play roles in multiple biologic processes including learning and memory, cardiac homeostasis, and antiviral immunity. Here, we report that PTENα maintains mitral cells in olfactory bulb (OB), regulates endocytosis in OB neurons, and controls olfactory behaviors in mice. We show that PTENα directly dephosphorylates the endocytic protein amphiphysin and promotes its binding to adaptor‐related protein complex 2 subunit β1 (Ap2b1). In addition, we identified mutations in the N terminus of PTENα in patients with Parkinson disease and Lewy‐body dementia, which are neurodegenerative disorders with early olfactory loss. Overexpression of PTENα mutant H169N in mice OB reduces odor sensitivity. Our data demonstrate a role of PTENα in olfactory function and provide insight into the mechanism of olfactory dysfunction in neurologic disorders.—Yuan, Y., Zhao, X., Wang, P., Mei, F., Zhou, J., Jin, Y., McNutt, M. A., Yin, Y. PTENα regulates endocytosis and modulates olfactory function. FASEB J. 33, 11148–11162 (2019). http://www.fasebj.org