From Aug 19, 2010 Scientific American:

Ketamine—a powerful anesthetic for humans and animals that lists hallucinations among its side effects and therefore is often abused under the name Special K—delivers rapid relief to chronically depressed patients, and researchers may now have discovered why. In fact, the latest evidence reinforces the idea that the psychedelic drug could be the first new drug in decades to lift the fog of depression.

“We were trying to figure out what ketamine was doing to produce this rapid response,” which can take as little as two hours to begin to act, says neuroscientist Ron Duman of the Yale University School of Medicine. So Duman and his colleagues gave a small amount of ketamine (10 milligrams per kilogram of body weight) to rats and watched the drug literally transform the animals’ brains. “Ketamine… can induce a rapid increase in connections in the brain, the synapses by which neurons interact and communicate with each other, ” Duman says. “You can visually see this response that occurs in response to ketamine.”

More specifically, as the researchers report in the August 20 issue of Science, ketamine seems to stimulate a biochemical pathway in the brain (known as mTOR) to strengthen synapses in a rat’s prefrontal cortex—the region of the brain associated with thinking and personality in humans. And the ketamine helped rats cope with the depression analog experience brought on by forcing the rodents to swim or exposing them to inescapable stress. “Preclinical and clinical studies show that repeated stress or depression can cause a decrease in connections and an atrophy of connections in the same region of the brain,” Duman explains, noting that magnetic resonance imaging shows that some depressed patients have a smaller prefrontal cortex as a result. “Ketamine has the opposite effect and can oppose or reverse the effects of depression” for roughly seven days per dose.

More: Scientific American