The influence of brain cholinergic activation on hepatic glycogenolysis and gluconeogenesis was studied in fed and 48-hour fasted rats. Neostigmine was injected into the third cerebral ventricle and hepatic venous plasma glucose, glucagon, insulin, and epinephrine were measured. The activity of hepatic phosphorylase-a and phosphoenolpyruvate-carboxykinase (PEP-CK) was also measured. Experimental groups: 1, intact rats; 2, rats infused with somatostatin through the femoral vein; 3, bilateral adrenodemedullated (ADMX) rats; 4, somatostatin infused ADMX rats; 5, 5-methoxyindole-2-carboxylic acid (MICA) was injected intraperitoneally 30 minutes before injection of neostigmine into the third cerebral ventricle of intact rats. MICA treatment completely suppressed the increase in hepatic glucose in fasted rats, but had no effect in fed rats. Phosphorylase-a activity was not changed in fasted rats, but increased in fed rats, intact rats, somatostatin-infused rats, somatostatin-infused ADMX rats, and ADMX rats in that order. PEP-CK was not changed in fed rats, but increased at 60 and 120 minutes after neostigmine injection into the third cerebral ventricle in fasted rats. We conclude that, in fed states, brain cholinergic activation causes glycogenolysis by epinephrine, glucagon, and direct neural innervation. In fasted states, on the other hand, gluconeogenesis is dependent on epinephrine alone to increase hepatic glucose output.