An electrophysiological method for evaluating changes in axonal excitability was used to examine presynaptic effects of the local striatal administration of nicotine on nigrostriatal dopaminergic terminal axons in the rat. To eliminate postsynaptic interactions, intrinsic striatal neurons were destroyed with a unilateral kainate lesion performed 10 to 15 days before the recording experiments. Excitability was assessed by determining the striatal stimulus current just sufficient to elicit an antidromic response from the striatal terminal field of a dopaminergic nigral neuron on 95% of the stimulus presentations. Local nicotine infusion (1-100 microM/0.3 microliter) produced a dose-dependent increase in excitability. Previous intrastriatal administration of the nicotine receptor antagonists mecamylamine or chlorisondamine blocked the nicotine effect and subsequent administration reversed the nicotine response. Increased dopamine autoreceptor stimulation, presumably resulting from nicotine-induced dopamine release, appeared to oppose the nicotine-induced increase in excitability. Accordingly, in animals in which dopamine synthesis was blocked with alpha-methyl-p-tyrosine (250 mg/kg, 12 and 2 h before recording), the nicotine-induced increase in terminal excitability was larger than in untreated rats. Simultaneous intrastriatal administration of the glutamate receptor antagonists, 6,7-dinitro-quinoxaline-2,3-dione and 2-amino-7-phosphonoheptanoate, prevented the nicotine-induced increase in excitability in animals with or without alpha-methyl-p-tyrosine pretreatment. We conclude that the nicotine-induced increase in nigrostriatal terminal excitability is an indirect effect resulting from a nicotine-evoked increase in glutamate release and a subsequent increase in the stimulation of presynaptic glutamate heteroreceptors on the dopamine-containing terminals.