The neuronal gene Arc is essential for long-lasting information storage in the mammalian brain and mediates various forms of synaptic plasticity. We recently discovered that Arc self-assembles into virus-like capsids that encapsulate RNA. Endogenous Arc protein is released from neurons in extracellular vesicles that mediate the transfer of Arc mRNA into new target cells. Evolutionary analysis indicates that Arc is derived from a vertebrate lineage of Ty3/gypsy retrotransposons, which are also ancestral to retroviruses such as HIV. These findings suggest that Gag retroelements have been repurposed during evolution to mediate intercellular communication in the nervous system that may underlie cognition and memory.