Transmitter release at synapses is regulated by preceding neuronal activity, which can give rise to short-term enhancement of release like post-tetanic potentiation (PTP). Diacylglycerol (DAG) and Protein-kinase C (PKC) signaling in the nerve terminal have been widely implicated in the short-term modulation of transmitter release, but the target protein of PKC phosphorylation during short-term enhancement has remained unknown. Here, we use a gene-replacement strategy at the calyx of Held, a large CNS model synapse that expresses robust PTP, to study the molecular mechanisms of PTP. We find that two PKC phosphorylation sites of Munc18-1 are critically important for PTP, which identifies the presynaptic target protein for the action of PKC during PTP. Pharmacological experiments show that a phosphatase normally limits the duration of PTP, and that PTP is initiated by the action of a 'conventional' PKC isoform. Thus, a dynamic PKC phosphorylation/de-phosphorylation cycle of Munc18-1 drives short-term enhancement of transmitter release during PTP.