The cortico-hippocampal circuit is critical for storage of associational memories. Most studies have focused on the role in memory storage of the excitatory projections from entorhinal cortex to hippocampus. However, entorhinal cortex also sends inhibitory projections, whose role in memory storage and cortico-hippocampal activity remains largely unexplored. We found that these long-range inhibitory projections enhance the specificity of contextual and object memory encoding. At the circuit level, these g-aminobutyric acid (GABA)-releasing projections target hippocampal inhibitory neurons and thus act as a disinhibitory gate that transiently promotes the excitation of hippocampal CA1 pyramidal neurons by suppressing feedforward inhibition. This enhances the ability of CA1 pyramidal neurons to fire synaptically evoked dendritic spikes and to generate a temporally precise form of heterosynaptic plasticity. Long-range inhibition from entorhinal cortex may thus increase the precision of hippocampal-based long-term memory associations by assessing the salience of mnemonormation to the immediate sensory input.