The effect of muscarine on neurosecretion was studied in the rat pheochromocytoma cell line, PC12. When PC12 cells were exposed to muscarine the cells responded rapidly with elevation of cellular inositol trisphosphate levels, elevation of intracellular free Ca++ and release of stored transmitter. These three phenomena were totally inhibited by the muscarinic antagonist, atropine, but were unaffected by the nicotinic antagonist, d-tubocurarine. Muscarine did not stimulate the production of cyclic GMP in these cells. The muscarine-stimulated increases in inositol trisphosphate, intracellular free Ca++ and neurotransmitter release displayed similar time courses and concentration dependencies suggesting that the secretion observed may be associated with the formation of inositol trisphosphate and elevation of intracellular free Ca++. The increase in intracellular free Ca++ appeared to be due to a mobilization of Ca++ from intracellular stores inasmuch as the increase in intracellular free Ca++ was not inhibited by the voltage-dependent Ca++ channel antagonist, nifedipine, at concentrations demonstrated to block K+-induced Ca++ influx into the cells, and little or no uptake of 45Ca++ was noted when cells were stimulated with muscarine. Elevation of inositol trisphosphate, intercellular free Ca++ and stimulation of transmitter release were, however, inhibited by the absence of extracellular Ca++. The results suggest that muscarine-stimulated release of neurotransmitter may be associated with an inositol trisphosphate-induced mobilization of intracellular Ca++.