Olfactory transduction is thought to occur by processes that are mainly restricted to the specialized cilia emanating from the distal end of the receptor neuron's single dendrite. The involvement of a cAMP-based second messenger system seems likely, and a cyclic nucleotide-sensitive current has been recorded in patches of membrane from the cilia. However, the small diameter of the cilia and the high density of channels within the membrane limit the application of the patch recording technique in the cilia. We have found that the cAMP-sensitive channels also exist at a much lower density within the far more accessible dendritic membrane. Recording from on-cell patches, we have observed single-channel activity in response to extracellularly applied odor substances. The channels have a single-channel conductance of 40 pS and a reversal potential near 0 mV. These same channels are activated by treatments that elevate intracellular cyclic nucleotide concentrations. The results provide a direct demonstration that the cyclic nucleotide-gated channel is the conductance pathway for the odor- elicited current.