The use of alcohol and nicotine are highly correlated, suggesting an underlying biochemical interaction. Chronic nicotine exposure results in a deactivation and subsequent upregulation of the expression of nicotinic acetylcholine receptors (nAChRs). Upregulation is thought to represent certain aspects of physical dependence on nicotine. If alcohol also alters nAChR expression or modulates the nicotine-induced upregulation, it could partially explain the high rate of co-abuse of these two drugs. We examined the effects of ethanol on the expression and nicotine-induced upregulation of nAChRs in two cell lines expressing different receptor subtypes. As measured by ligand binding, ethanol initially decreased nAChR expression in M10 cells but increased expression with a more chronic exposure. In the presence of nicotine, the effect of ethanol was similar; initially acting to blunt the upregulation of receptor expression caused by nicotine but enhancing the upregulation with 96 h of exposure. The upregulation of nAChRs was long lasting, remaining above control levels for as long as 7 days following removal of nicotine and ethanol. In PC12 cells, ethanol increased expression at all time points examined. A protein phosphatase inhibitor reduced nicotine-induced upregulation and a PKC inhibitor blocked the ethanol-induced decrease in nAChR expression. These data suggest that ethanol and nicotine interact at the level of the PKC pathway to regulate expression of nAChRs.