The dentate gyrus (DG) is the entrance gate of the hippocampus and translates the rich input stream from the entorhinal cortex into sparse non-overlapping memories. The network mechanisms underlying sparse coding are however largely unknown. In this talk, I will highlight new insights on the role of the various cellular components of the DG network, glutamatergic granule cells (GCs) and GABAergic inhibitory interneuron types in the sparse coding of information and the spatio-temporal emergence of DG population activity during learning. I will provide new insights on the relationship between the rich input stream provided by the medial entorhinal cortex to the DG and the hippocampal areas CA1 and CA3 and the spatial code generated by the principal cell output, which is forwarded to downstream brain areas for mnemonic associations. I will present our recently published and unpublished data obtained with state-of-the-art techniques including single unit recordings and 2-photon population imaging of neuron types in behaving rodents, to test their role in cell assembly formation for the representation of space and context during learning.