Acetylcholinesterase activity was demonstrated histochemically at light- and electron-microscopic levels, in Vibratome sections of the supraoptic nucleus of fixed hypothalami derived from osmotically stimulated and unstimulated Long Evans rats, from homozygous Brattleboro rats with hypothalamic diabetes insipidus, from lactating rats, from normal adult male house mice (Mus musculus) and from mice with hereditary nephrogenic diabetes insipidus (di/di). Reaction product was located in supraoptic magnocellular neurons; in dorsal and rostral aspects of the supraoptic nuclei lightly stained cells predominate, whereas in ventral and caudal regions densely staining perikarya predominate. Pre- and post-embedding immunocytochemical detection of oxytocin-neurophysin or vasopressin-neurophysin, combined with acetylcholinesterase histochemistry, showed that the lightly staining cells are oxytocinergic, and the densely staining cells vasopressinergic. Osmotic stimulation of the animals, either by substitution of drinking water for 3 days with 2.5% saline or reason of genetic defects which result in diabetes insipidus, enhanced the acetylcholinesterase activity of the vasopressin neurons but had little effect on the weekly acetylcholinesterase-reactive oxytocin cells. Acetylcholinesterase activity was particularly marked in the hypertrophied abnormal magnocellular neurons of homozygous Brattleboro rats which do not release significant amounts of vasopressin. The increased acetylcholinesterase activity in osmotically stimulated animals cannot, therefore, be a function of vasopressin. Acetylcholinesterase activity was also detected in large multipolar neurons lying dorsolateral to the supraoptic nucleus, and in their fine axonal processes which project towards the supraoptic nucleus. A very few synaptic boutons surrounded by acetylcholinesterase reaction product were found in contact with magnocellular neuron basal dendrites. However, much of the punctate acetylcholinesterase reactivity observed at the light microscopic level and previously interpreted as representing the loci of cholinergic synaptic boutons was shown to be intracellular, and probably caused by acetylcholinesterase activity in some large, secondary lysosomes.