The nature of the control of hippocampal formation field activity [theta (theta) and large-amplitude irregular activity (LIA)] and theta- on/theta-off cell discharges by an ascending hypothalamo-septal pathway was investigated in urethane-anesthetized rats. Electrical stimulation of the dorsomedial-posterior hypothalamus in the range of 0.1–1.0 mA in 0.1-mA steps produced theta in the hippocampal formation, with a linear positive relation between stimulus intensity, theta frequency, and theta amplitude. Reversible blockade of the medial septal (MS)/vertical limb of the diagonal band of Broca (vDBB) region by microinjection of procaine hydrochloride abolished spontaneous and hypothalamically elicited theta, resulting in a field activity at 1-min post-procaine that had a lower power than pre-procaine LIA levels. The efficacy and recovery of the MS/vDBB suppression was tested at 1, 10, 20, 30, 40, 50, and 60 min post-procaine using 0.5, 0.8, and 1.0 mA of hypothalamic stimulation. All three of the dependent measures of hippocampal field activity (frequency, amplitude, and power) showed a progressive recovery during the 60-min post-procaine period. Frequency exhibited a rapid recovery with a shallow slope between 20 and 60 min post- procaine. In contrast, the amplitude and power of theta exhibited a gradual recovery with a steeper slope between 20 and 60 min post- procaine. During the time of maximal MS/vDBB suppression, theta-on cell discharges were reduced to 0 in most cases. The initial recovery of theta-on cells in the post-procaine condition was correlated with the first appearance of theta and was characterized by low discharge rates.