The adult brain is plastic and able to reorganize structurally and functionally after damage. Growth factors are key molecules underlying the recovery process and among trophic molecules, Insulin-Like Growth Factor-I (IGF-I) is of particular interest given that it modulates neuronal and glial responses in the hippocampus including neurogenesis, which has been proposed as a mechanism of neurorepair. In this study we analyzed the effect of intracerebroventricular chronic infusion of IGF-I on functional recovery and morphological restoration after the induction of an excitotoxic lesion in the dentate gyrus (DG) of young-adult rats. Our results show that the lesion impairs contextual fear memory which is a DG dependent task, but not cued fear memory or performance in the open field motor task, which are independent of the DG integrity. Chronic administration of IGF-I, but not vehicle, promotes functional recovery to control levels in injured subjects. Analysis in NeuN immunoprocessed tissue revealed that the lesion volume was not different between groups and that the DG was not evidently restructured in the IGF-I treated group. Glial fibrillary acidic protein (GFAP) analysis revealed an increased astrocytic response in the injured region in both groups and Doublecortin (DCX) analysis showed a similar increase in number of newly born neurons in both groups. However, a remarkable increase in young neurons dendritic arborization was observed in the IGF-I treated group. These results provide evidence for IGF-I as a molecule mediating functional and cellular plasticity during a reorganization process after damage to a neurogenic niche.