To determine if serotonin and GABA regulate post-trial memory processing of the cholinergic projection from the septum to the hippocampus, mice were trained on footshock avoidance in a T-maze. Immediately after training, drugs were injected into the septum, hippocampus or both. Retention was tested 1 week after training and drug administration. Ketanserin, a serotonin type 2 receptor antagonist at a dose of 0.5 ng, had no measurable effect on retention, but it reduced the dose of bicuculline, in the septum, or arecoline in the hippocampus that was needed to improve retention. DOI, a serotonin type 2 receptor agonist at a dose of 2.5 ng, had the opposite effect of increasing the doses of bicuculline and arecoline needed to improve retention. Bicuculline, a GABA(A) receptor antagonist at a dose of 0.1 pg, did not affect retention when injected alone into the septum, but it reduced the dose of arecoline needed to improve retention in the hippocampus. Muscimol, a GABA(A) receptor agonist at a dose of 5 ng, injected into the septum, increased the dose of arecoline needed to improve retention. The results of this study are compatible with models that propose that serotonin innervation from the median raphe drives GABA interneurons in the medial septum that synapse on cholinergic neurons projecting to the hippocampus.