Modulation of ionic channel properties and synaptic functions by neurotransmitters and hormones is called neuro-modulation and may be the basis for many long-lasting changes in animal behavior, for example, changes in the arousal or motivational states. We have previously shown in a teleost, the dwarf gourami, that the terminal nerve (TN) cells are a major component of the gonadotropin-releasing hormone (GnRH) system and are structurally independent from the preoptic/hypophysial-GnRH system, which projects to the pituitary and facilitates gonadotropin release from the gonadotropes. While GnRH fibers originating from TN cells are distributed widely throughout the brain, they do not project to the pituitary. Thus, TN-GnRH system does not function as a hypophysiotropic hormone but probably as a neuro- modulator, capable of affecting widespread regions of the brain. In the present study, we used a whole-brain in vitro preparation to examine the spontaneous electrical activities of TN-GnRH cells and to determine the morphology of individual cells by intracellular injections of either neurobiotin or biocytin. The recorded cells were clearly identified as GnRH-immunoreactive TN cells by using combined intracellular injection and GnRH immunocytochemistry. Most of the TN cells showed endogenous slow (1–7 Hz), regular beating discharges. The intrinsic nature of this activity was demonstrated by the voltage dependency of the beating frequency, rhythm resetting, and persistence of rhythmicity after synaptic isolation. Only a small number of TN cells showed either irregular or bursting discharge patterns. Anatomical observation of intracellularly labeled cells showed that, regardless of discharge patterns, all the TN cells had multiple axonal branches that project to those areas where we had previously demonstrated dense GnRH-immunoreactive fibers. From the present results, we propose a hypothesis that may be relevant to the peptidergic and monoaminergic neuromodulatory systems in general. The modulator neurons have endogenous rhythmic activities that vary according to the animal's hormonal or environmental conditions, and they regulate the excitability of target neurons in a wide variety of brain regions simultaneously via multiple axonal branches.