1. In smooth muscle cells of the rabbit carotid artery, ACh (greater than 10(-8) M) generated a hyperpolarization with two components (transient followed by sustained), only in the tissues with an intact endothelium. There were no detectable changes in the membrane potential, as elicited by ACh (up to 10(-5) M) in tissues with no endothelium or in the presence of atropine (10(-6) M). 2. Reduction of [Ca2+]o inhibited the sustained component which was not apparent in [Ca2+]o below 0.16 mM. In Ca2+-free (EGTA-containing) solution, the generation of the transient component of the hyperpolarization remained sustained but with a substantially reduced amplitude. 3. Procaine (greater than 10(-6) M) inhibited the ACh-induced hyperpolarization in a concentration-dependent manner, and at a concentration of procaine (10(-3) M) which caused substantial depolarization of the membrane, no detectable change was elicited by ACh. 4. Caffeine (10(-6)-10(-3) M) produced a transient hyperpolarization, independent of the presence or absence of the endothelium, and inhibited the sustained component of the ACh-induced hyperpolarization more so than the initial component. 5. A23187 (greater than 10(-8) M) hyperpolarized the smooth muscle membrane in a concentration-dependent manner, and this hyperpolarization was not generated in Ca2+-free solution or in the absence of endothelial cells. 6. In intact tissues, pre-treatment with A23187 resulted in a reduction of the subsequently generated ACh-induced hyperpolarization, in an irreversible manner. 7. It would thus appear that in the rabbit carotid artery, the endothelium-dependent hyperpolarization induced by ACh has Ca2+-dependent and Ca2+-independent components, and each may be related to the increase in endothelial [Ca2+]i by release from the intracellular store and by influx from the extracellular medium, respectively. The increased [Ca2+]i would trigger a release of an endothelium-derived hyperpolarizing factor (EDHF) from the endothelial cells.