Correlated light and electron microscopic double-immunostaining experiments for Leu-enkephalin and calbindin were employed to determine the postsynaptic targets in the septal complex of Leu-enkephalin fibers. Chronic surgical isolation of the septal complex from its hypothalamic afferents and retrograde tracer studies using wheat germ agglutinin-conjugated horseradish peroxidase, both followed by an immunostaining for Leu-enkephalin, were performed to elucidate the location of the origin of these axon terminals. Furthermore, a colocalization study for glutamic acid decarboxylase and Leu-enkephalin was carried out on hypothalamic sections to determine their possible coexistence in cells projecting to the lateral septum. These studies revealed that 1) Leu-enkephalin-immunoreactive axons form pericellular baskets around a population of lateral septal area neurons; 2) they establish exclusively asymmetric synaptic contacts on their soma and initial dendritic segments; 3) 10% of the lateral septal area calbindin-containing cells, which are all of the gamma-aminobutyric acid (GABA)-ergic somatospiny type, are innervated by Leu-enkephalin-immunoreactive baskets; 4) only 40% of the Leu-enkephalin target neurons are calbindin immunopositive; 5) the septopetal Leu-enkephalin fibers derive from neurons located in the ipsilateral perifornical area and anterior hypothalamus; and 6) none of their cells of origin cocontains the inhibitory transmitter GABA. These observations indicate that hypothalamic Leu-enkephalin-containing neurons are non-GABAergic excitatory cells. Hence, they can effectively stimulate a population of lateral septal area neurons, including the somatospiny cells, which are all GABAergic. Therefore, after stimulatory Leu-enkephalin action, these neurons can inhibit their postsynaptic targets, including other projective lateral septal neurons.