Fast-acting neurotransmitters and slow, modulatory neuropeptides are co-released from neurons in the central nervous system, albeit from distinct synaptic vesicles1. The mechanisms of how co-released neurotransmitters and neuropeptides that have opposing actions-for example, stimulatory versus inhibitory-work together to exert control of neural circuit output remain unclear. This has been difficult to resolve owing to the inability to selectively isolate these signalling pathways in a cell- and circuit-specific manner. Here we developed a genetic-based anatomical disconnect procedure that utilizes distinct DNA recombinases to independently facilitate CRISPR-Cas9 mutagenesis2 of neurotransmitter- and neuropeptide-related genes in distinct cell types in two different brain regions simultaneously. We demonstrate that neurons within the lateral hypothalamus that produce the stimulatory neuropeptide neurotensin and the inhibitory neurotransmitter GABA (γ-aminobutyric acid) utilize these signals to coordinately activate dopamine-producing neurons of the ventral tegmental area. We show that GABA release from lateral hypothalamus neurotensin neurons inhibits GABA neurons within the ventral tegmental area, disinhibiting dopamine neurons and causing a rapid rise in calcium, whereas neurotensin directly generates a slow inactivating calcium signal in dopamine neurons that is dependent on the expression of neurotensin receptor 1 (Ntsr1). We further show that these two signals work together to regulate dopamine neuron responses to maximize behavioural responding. Thus, a neurotransmitter and a neuropeptide with opposing signals can act on distinct timescales through different cell types to enhance circuit output and optimize behaviour.