Neuronal nicotinic ACh receptors (nAChRs) are present in the rat medial habenula (MHB) and interpeduncular nucleus (IPN), two brain regions connected through the fasciculus retroflexus (FR). The goal of the present study was to compare the electrophysiological and pharmacological characteristics of nAChRs located at pre- and postsynaptic sites within the MHB-IPN system. nAChRs located on the soma of IPN neurons were studied using patch-clamp techniques and a preparation of acutely isolated neurons. Whole-cell currents evoked by Ach and nicotine showed an intense rectification at positive membrane potentials. nAChR channels were relatively nonselective for cations, had a unitary conductance of 35 pS, and were activated by several nicotinic agonists with the following rank order: cytisine greater than ACh greater than nicotine greater than dimethylphenylpiperazinium (DMPP). They were blocked by mecamylamine, hexamethonium, curare, and dihydro-beta-erythroidine (DHBE), but were insensitive to alpha- bungarotoxin and neuronal bungarotoxin. In contrast, nAChRs recorded on the soma of MHB neurons under equivalent experimental conditions exhibited different characteristics for single-channel conductance and agonist and antagonist sensitivity. The pharmacological properties of presynaptic nAChRs in the IPN were analyzed in a rat brain slice preparation. Stimulation of the FR produced a presynaptic afferent volley recorded in the rostral subnucleus of the IPN. Nicotinic agonists decreased the amplitude of the afferent volley with different efficacies: nicotine greater than cytisine greater than ACh greater than DMPP. The action of nicotine was insensitive to alpha-bungarotoxin and to neuronal bungarotoxin, but was blocked by mecamylamine, hexamethonium, curare, and DHBE, with IC50 values different from those reported for IPN postsynaptic nAChRs. This study thus demonstrates the functional diversity of nAChRs in the rat CNS.