The developing visual thalamus and cortex extract positional information encoded in the correlated activity of retinal ganglion cells by synaptic plasticity, allowing for the refinement of connectivity. Here, we use a biophysical model of the visual thalamus during the initial visual circuit refinement period to explore the role of synaptic and circuit properties in the regulation of such neural correlations. We find that the NMDA receptor dominance, combined with weak recurrent excitation and inhibition characteristic of this age, prevents the emergence of spike-correlations between thalamocortical neurons on the millisecond timescale. Such precise correlations, which would emerge due to the broad, unrefined connections from the retina to the thalamus, reduce the spatial information contained by thalamic spikes, and therefore we term them ‘parasitic’ correlations. Our results suggest that developing synapses and circuits evolved mechanisms to compensate for such detrimental parasitic correlations arising from the unrefined and immature circuit.