The cholinergic system exerts an important modulatory effect on hippocampal functions. Presynaptic inhibition of hippocampal and neocortical acetylcholine (ACh) release by serotonin (5-HT) has been reported in both rat and human brain. There is some controversy, however, concerning the 5-HT receptor which mediates the inhibitory effects of 5-HT. Using slices of the hippocampal formation of rat prelabelled with [3H]-overflow ([3H]-choline, superfused and depolarized electrically (2 min, 3 Hz, 2 ms, 24 mA) or by K+ (20 mM) we observed that 5-HT inhibits hippocampal and entorhinal [3H]-overflow ([3H]-ACh release) by 5-HT1B receptors located on cholinergic terminals. However, this inhibition requires the functional elimination of substance P/gamma-aminobutyric acid (SP/GABA) interneurons which express 5-HT2A receptors as shown by in situ hybridisation histochemistry. Activation of these somadendritically located 5-HT2a receptors facilitates SP release. SP, in turn, stimulates hippocampal [3H]-ACh release through NK1 receptors present on cholinergic terminals. These findings suggest close links between cholinergic afferents, SP interneurons and 5-HT2 receptors. A loss of cholinergic afferents and 5-HT2 receptors, along with a reduction in substance P-immunoreactive neurons, have been observed in the brains of patients suffering from Alzheimer's disease, suggesting the concept that these three alterations reflect a disruption of a functional unit. The present findings might help to explain early pathological changes in Alzheimer's disease.