Though it has been known for over half a century that interference with the normal activity of septohippocampal neurons can abolish hippocampal theta rhythmicity, a definitive answer to the question of its function has remained elusive. To clarify the role of septal circuits and theta in location-specific activity of place cells and spatial behavior, three drugs were delivered to the medial septum of rats: Tetracaine, a local anesthetic; muscimol, a GABA-A agonist; and gabazine, a GABA-A antagonist. All three drugs disrupted normal oscillatory activity in the hippocampus. However, tetracaine and muscimol both reduced spatial firing and interfered with the rat's ability to navigate to a hidden goal. After gabazine, location-specific firing was preserved in the absence of theta, but rats were unable to accurately locate the hidden goal. These results indicate that theta is unnecessary for location-specific firing of hippocampal cells, and that place cell activity cannot support accurate navigation when septal circuits are disrupted.