This dissertation investigates the mechanisms underlying pattern separation, using rodent models and behavioural tasks that assess the use of representations for similar stimuli. Pattern separation is a theoretical mechanism involving the transformation of inputs into output representations that are less correlated to each other. Because of this orthogonalizing process, similar experiences are stored as discrete non-overlapping representations. Studying pattern separation emphasizes the important but often overlooked fact that successful memory involves more than just remembering events over a period of time, but also differentiating between similar memories. Through a series of experiments this dissertation adds support to the literature that the dentate gyrus (DG) subregion of the hippocampus is important for pattern separation when encoding spatial and contextual inputs. Using the Spontaneous Location Recognition (SLR) task it is shown the brain-derived neurotrophic factor (BDNF) can improve performance by acting via N-methyl-D-aspartate (NMDA) glutamate receptors in the DG and adult-born hippocampal neurons. Manipulating the level of neurogenesis by inhibiting Wnt signalling or by administering acyl-ghrelin systemically is shown to impair and enhance performance on SLR, respectively. Using a novel exposure paradigm in combination with SLR, it is demonstrated for the first time that the relationship between pattern separation and neurogenesis may be reciprocal, such that inhibiting neurogenesis impairs pattern separation, enhancing neurogenesis improves pattern separation, and performing pattern separation enhances the production or survival of adult-born hippocampal neurons. Finally, it is shown that the $TgTauP301L$ mouse model of dementia exhibits spatial and object recognition memory impairments once aged, recapitulating a dementia-like phenotype. Understanding the mechanisms that contribute to effective pattern separation may help elucidate the processes underlying the memory impairment experienced by AD patients. This dissertation concludes with a critical discussion about whether pattern separation can be studied using behavioural paradigms.