Both delayed gastrointestinal transit and autonomic neuropathy have been documented in patients with diabetes mellitus. The mechanism of neostigmine, an agent that mimics release of acetylcholine from autonomic neurons by prokinetic agents, to contract smooth muscle, despite dysfunctional enteric neural pathways, was determined using isolated ilea from STZ-treated and control guinea pigs. Both bethanechol- and neostigmine-induced contractions were stronger in diabetic ileum. Bethanechol-induced contractions of control but not diabetic ileum were increased by low dose scopolamine suggesting reduced activation of presynaptic muscarinic autoreceptors in diabetic ileum. The muscarinic receptor antagonist 4-DAMP strongly, but the nicotinic receptor antagonist hexamethonium only weakly, reduced neostigmine-induced contractions of control and diabetic ilea. The amount of acetylcholine, inferred from tissue choline content, was increased in diabetic ileum. Nicotinic neural and noncholinergic postjunctional smooth muscle receptors contributed more strongly to neostigmine-induced contractions in diabetic than control ileum. Relaxation of diabetic ileum by exogenous nitric oxide generated from sodium nitroprusside was comparable to control ileum, but smooth muscle relaxation by l-arginine using neuronal nitric oxide synthase to generate nitric oxide was weaker in diabetic ileum with evidence for a role for inducible nitric oxide synthase. Despite autonomic neuropathy, neostigmine strongly contracted ileum from diabetic animals but by a different mechanism including stronger activation of postjunctional muscarinic receptors, greater synaptic acetylcholine, stronger activation of noncholinergic excitatory pathways, and weaker activation of inhibitory pathways. A selective medication targeting a specific neural pathway may more effectively treat disordered gastrointestinal transit in patients with diabetes mellitus.