1. The physiology of ventral pallidal (VP) cells was investigated using in vivo intracellular recording and staining techniques in adult rats. Based on electrophysiological criteria, three different types of cells were found: type A cells, which fired phasic spikes that did not exhibit a substantial afterhyperpolarization (AHP), type B cells, which exhibited a slow ramplike depolarization that preceded the short-duration action potential; the spike was followed by a prominent AHP, and type C cells, which were the only cells that fired spikes in couplets or bursts, with the spikes in a burst exhibiting a progressive increase in duration and a decrease in amplitude. These cells also exhibited a rebound low threshold spikelike event. Furthermore, 18% of the VP cells recorded exhibited a slow subthreshold oscillation of the membrane potential (< 1 Hz). 2. The response of VP cells to stimulation of fibers arising from the prefrontal cortex, nucleus accumbens, and mediodorsal thalamic nucleus (MD) was examined. In contrast to our initial predictions, all cells responded to nucleus accumbens stimulation with excitation. Type A and B cells responded to nucleus accumbens stimulation with excitation and to MD stimulation with antidromic-like responses, orthodromic excitation, or evoked inhibitory postsynaptic potentials. Only type A cells responded to prefrontal cortical stimulation. Type C cells only responded to stimulation of the nucleus accumbens, which resulted in evoked excitatory postsynaptic potentials. 3. The cells in the VP therefore can be segregated into three physiologically defined groups according to action potential discharge patterns and their response to afferent fiber stimulation.