Extracellular recordings were made from neurones in the ventromedial and parafasicular nuclei of the rat thalamus, many of which had demonstrable capsular or caudate projections. These cells responded to electrical stimulation of the ipsilateral substantia nigra with a short latency (4 ms) inhibition presumed to be monosynaptic. This inhibitory response was often preceded by a brief period of increased excitability (latency approximately 3 ms) attributed to activation of corticofugal collaterals. Longer latency, presumably oligosynaptic excitations (latency approximately 8 ms) and inhibitions (approximately 18 ms) were also obtained, but were more commonly evoked in non-projection neurones. All units were inhibited by iontophoretically applied GABA, glycine or 5-HT. Short and long latency synaptic and GABA-induced inhibitions were selectively blocked by bicuculline. Strychnine only antagonised glycine, while 5-HT was not affected by either convulsant. Intranigral injection of muscimol greatly elevated the spontaneous discharge rate of thalamic neurones, particularly those with a striatal projection. These data are compatible with nigrothalamic neurones maintaining a tonically active, GABA-mediated inhibition of cells in the ventromedial and parafascicular nuclei of the thalamus. It is speculated that intranigral muscimol indirectly activates these thalamic cells and thereby initiates contraversive circling behaviour by suppressing this inhibitory system.