The piriform (or primary olfactory) cortex is a trilaminar structure that is the first cortical destination of olfactory information, receiving monosynaptic input from the olfactory bulb. Here, we show that the main input layer of the piriform cortex, layer II, is dominated by two classes of principal neurons, superficial pyramidal (SP) and semilunar (SL) cells, with strikingly different properties. Action potentials in SP cells are followed by a Ni2+-sensitive afterdepolarization that promotes burst firing, whereas SL cells fire nonbursting action potentials that are followed by a powerful afterhyperpolarization. Synaptic inputs from the olfactory bulb onto SP cells exhibit prominent paired-pulse facilitation, which is attributable to residual presynaptic Ca2+ and a low probability of neurotransmitter release. In contrast, the same inputs onto SL cells do not facilitate. These distinctive synaptic and firing properties cause SP and SL cells to respond differently to in vivo-like bursts of afferent stimulation: SP cells tend to fire bursts of output action potentials at a higher frequency than the input, whereas SL cells tend to fire at a lower frequency than the input. When connected together in the canonical circuit of the piriform cortex, SP and SL cells transform the pattern of synaptic inputs they receive from the olfactory bulb, dispersing the firing rate and latency of output action potentials to an extent that depends on the strength of the input. Thus, the presence of two types of principal cells in layer II of the piriform cortex may underlie coding strategies used for the representation of odors.