Presynaptic Ca2+ regulates many processes related to neurotransmission including synaptic vesicle (SV) release and endocytosis. However, the role of Ca2+ in other aspects of presynaptic function is incompletely understood. Furthermore, the repertoire of Ca2+ channels functioning at the synapse remains unknown. In a screen evaluating the roles of TRP channels in Drosophila larval neuromuscular junction function and development, we found that the TRPV channel, Inactive (Iav), functions presynaptically to regulate both synaptic growth and SV release probability. We found that the Iav-deficient (mut) synapses have a reduced number of presynaptic boutons (number of boutons, mut = 33.8±2.4, wild-type (wt) = 67.7±4.1, p<0.05, all data presented as mean ±SEM and analyzed by ANOVA hereafter) and a concomitant increase in bouton size (bouton volume, mut = 320.6 ±74.9 μm3, wt = 142.2±31.5, p<0.05). Biochemical and high-resolution imaging experiments revealed that the mutant boutons were characterized by diminished microtubule polymerization (polymerized microtubule percentage, mut = 6.6±0.02%, wt = 20±0.02, p<0.05). Furthermore, we found that calcineurin A1 (CanA1) deficient synapses displayed similar phenotypes. More importantly, expression of constitutively active CanA1 in Iav-deficient motor neurons suppressed the growth defects (bouton number, mut expressing CanA1 = 61.2±1.9, mut control = 42.9±1.6, p<0.05). These data indicate that CanA1 stabilizes microtubules downstream of Iav. Remarkably, expressing human TRPV1 in the Iav-deficient motor neurons rescued the synaptic growth phenotypes (bouton number, mut expressing TRPV1 = 67.7±3.2, mut controls = 43.3±2.5, p<0.05). Examination of the subcellular distribution of Iav and TRPV1 in the motor neurons revealed that both proteins were localized to ER. Furthermore, we found that Iav regulates resting Ca2+ levels in motor axon terminals, and the loss of Iav results in a decrease in the amplitudes of evoked excitatory junction potentials (EJP) (mut = 12.4±1.1 mV, wt = 25.8±2.7, p<0.05). Further studies revealed that the SV release probability was markedly diminished in the absence of Iav, and this decrease in release probability underlies the decreased EJP amplitude. Indeed, elevating extracellular Ca2+ levels to increase SV release probability suppressed the EJP defect. Interestingly, overexpression of Iav increased SV release probability and EJP amplitudes. Thus, Iav is both necessary and sufficient to determine SV release and function, indicative of the vital role of the protein in neurotransmission. In summary, by releasing ER Ca2+, Iav serves two physiologically distinct and separable functions. First, it regulates synaptic architecture and growth by promoting microtubule polymerization. Second, it determines SV release probability and the strength of synaptic transmission.