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Abstract: Stress has been considered as a major risk factor for depressive disorders, triggering depression onset via inducing persistent dysfunctions in specialized brain regions and neural circuits. Among various regions across the brain, the lateral habenula (LHb) serves as a critical hub for processing aversive information during the dynamic process of stress accumulation, thus having been implicated in the pathogenesis of depression. LHb neurons integrate aversive valence conveyed by distinct upstream inputs, many of which selectively innervate the medial part (LHbM) or lateral part (LHbL) of LHb. LHb subregions also separately assign aversive valence via dissociable projections to the downstream targets in the midbrain which provides feedback loops. Despite these strides, the spatiotemporal dynamics of LHb-centric neural circuits remain elusive during the progression of depression-like state under stress. In this review, we attempt to describe a framework in which LHb orchestrates aversive valence via the input-output specific neuronal architecture. Notably, a physiological form of Hebbian plasticity in LHb under multiple stressors has been unveiled to incubate neuronal hyperactivity in an input-specific manner, which causally encodes chronic stress experience and drives depression onset. Collectively, the recent progress and future efforts in elucidating LHb circuits shed light on early interventions and circuit-specific antidepressant therapies.