The mechanisms of action of acetylcholine (ACh) in the guinea-pig neocortex were investigated using intracellular recordings from layer V pyramidal cells of the anterior cingulate cortical slice. At resting membrane potential (Vm = -80 to -70 mV), ACh application resulted in a barrage of excitatory and inhibitory post-synaptic potentials (p.s.p.s) associated with a decrease in apparent input resistance (Ri). ACh, applied to pyramidal neurones depolarized to just below firing threshold (Vm = -65 to -55 mV), produced a short-latency hyperpolarization concomitant with p.s.p.s and a decrease in Ri, followed by a long-lasting (10 to greater than 60 s) depolarization and action potential generation. Both of these responses were also found in presumed pyramidal neurones of other cortical regions (sensorimotor and visual) and were blocked by muscarinic, but not nicotinic, antagonists. The ACh-induced hyperpolarization possessed an average reversal potential of -75.8 mV, similar to that for the hyperpolarizing response to gamma-aminobutyric acid (GABA; -72.4 mV) and for the i.p.s.p. generated by orthodromic stimulation (-69.6 mV). This cholinergic inhibitory response could be elicited by ACh applications at significantly greater distance from the cell than the slow depolarizing response. Blockade of GABAergic synaptic transmission with solution containing Mn2+ and low Ca2+, or by local application of tetrodotoxin (TTX), bicuculline or picrotoxin, abolished the ACh-induced inhibitory response but not the slow excitatory response. In TTX (or Mn2+, low Ca2+) the slow excitatory response possessed a minimum onset latency of 250 ms and was associated with a voltage-dependent increase in Ri. Application of ACh caused short-latency excitation associated with a decrease in Ri in eight neurones. The time course of this excitation was similar to that of the inhibition seen in pyramidal neurones. Seven of these neurones had action potentials with unusually brief durations, indicating that they were probably non-pyramidal cells. ACh blocked the slow after-hyperpolarization (a.h.p.) following a train of action potentials, occasionally reduced orthodromically evoked p.s.p.s, and had no effect on the width or maximum rate of rise or fall of the action potential. It is concluded that cholinergic inhibition of pyramidal neurones is mediated through a rapid muscarinic excitation of non-pyramidal cells, resulting in the release of GABA. In pyramidal cells ACh causes a relatively slow blockade of both a voltage-dependent hyperpolarizing conductance (M-current) which is most active at depolarized membrane potentials, and the Ca2+-activated K+ conductance underlying the a.h.p.(ABSTRACT TRUNCATED AT 400 WORDS)