To generate brain circuits that are both flexible and stable requires the coordination of powerful developmental mechanisms acting at different scales, including activity-dependent synaptic plasticity and changes in single neuron properties. The brain prepares to efficiently compute information and reliably generate behavior during early development without any prior sensory experience but through patterned spontaneous activity. After the onset of sensory experience, ongoing activity continues to modify sensory circuits, and plays an important functional role in the mature brain. Using quantitative data analysis, experiment-driven theory and computational modeling, I will present a framework for how neural circuits are built and organized during early postnatal development into functional units, and how they are modified by intact and perturbed sensory-evoked activity. Inspired by experimental data from sensory cortex, I will then show how neural circuits use the resulting non-random connectivity to flexibly gate a network’s response, providing a mechanism for routing information.