Nicotinic signaling in prefrontal layer VI pyramidal neurons is important to the function of mature attention systems. The normal incorporation of α5 subunits into α4β2* nicotinic acetylcholine receptors augments nicotinic signaling in these neurons and is required for normal attention performance in adult mice. However, the role of α5 subunits in the development of the prefrontal cortex is not known.We sought to answer this question by examining nicotinic currents and neuronal morphology in layer VI neurons of medial prefrontal cortex of wild-type and α5 subunit knockout (α5(-/-)) mice during postnatal development and in adulthood.In wild-type but not in α5(-/-) mice, there is a developmental peak in nicotinic acetylcholine currents in the third postnatal week. At this juvenile time period, the majority of neurons in all mice have long apical dendrites extending into cortical layer I. Yet, by early adulthood, wild-type but not α5(-/-) mice show a pronounced shift toward shorter apical dendrites. This cellular difference occurs in the absence of genotype differences in overall cortical morphology.Normal developmental changes in nicotinic signaling and dendritic morphology in prefrontal cortex depend on α5-comprising nicotinic acetylcholine receptors. It appears that these receptors mediate a specific developmental retraction of apical dendrites in layer VI neurons. This finding provides novel insight into the cellular mechanisms underlying the known attention deficits in α5(-/-) mice and potentially also into the pathophysiology of developmental neuropsychiatric disorders such as attention-deficit disorder and autism.