The dentate gyrus plays a key role in the discrimination of memories by segregating and storing similar episodes. Whether hilar mossy cells, which constitute a major excitatory principal cell type in the mammalian hippocampus, contribute to this decorrelation function has remained largely unclear. Using two-photon calcium imaging of head-fixed mice performing a spatial virtual reality task, we show that mossy cell populations robustly discriminate between familiar and novel environments. The degree of discrimination depends on the extent of visual cue differences between contexts. A context decoder revealed that successful environmental classification is explained mainly by activity difference scores of mossy cells. By decoding mouse position, we reveal that in addition to place cells, the coordinated activity among active mossy cells markedly contributes to the encoding of space. Thus, by decorrelating context information according to the degree of environmental differences, mossy cell populations support pattern separation processes within the dentate gyrus.