We present a biologically plausible model of processing intrinsic to the basal ganglia based on the computational premise that action selection is a primary role of these central brain structures. By encoding the propensity for selecting a given action in a scalar value (the salience), it is shown that action selection may be recast in terms of signal selection. The generic properties of signal selection are defined and neural networks for this type of computation examined. A comparison between these networks and basal ganglia anatomy leads to a novel functional decomposition of the basal ganglia architecture into 'selection' and 'control' pathways. The former pathway performs the selection per se via a feedforward off-centre on-surround network. The control pathway regulates the action of the selection pathway to ensure its effective operation, and synergistically complements its dopaminergic modulation. The model contrasts with the prevailing functional segregation of basal ganglia into 'direct' and 'indirect' pathways.