Recurrent inhibition in olfactory bulb mitral cells is mediated via reciprocal dendrodendritic synapses with granule cells. Although GABAergic granule cells express both NMDA and non-NMDA glutamate receptors, dendrodendritic inhibition (DDI) relies on the activation of NMDA receptors. Using whole-cell recordings from rat olfactory bulb slices, we now show that olfactory NMDA receptors have a dual role; they depolarize granule cell spines, and they provide a source of calcium that can evoke GABA exocytosis. We demonstrate that exogenous NMDA can trigger GABA release after blockade of voltage-dependent calcium channels (VDCCs) with Cd. We also find that postsynaptic depolarization alone can evoke GABA release via a separate mechanism that relies on calcium influx through Cd-sensitive VDCCs. By selectively manipulating postsynaptic responses in granule cells with high-K or low-Na extracellular solutions, we show that endogenous glutamate can elicit GABA release via both NMDA receptor- and VDCC-dependent pathways. Finally, we find that blockade of Na channels in granule cells with tetrodotoxin enhances DDI, presumably by reducing the depolarization of granule cells during DDI and thereby increasing the driving force for Ca entry through NMDA receptors. These results provide evidence of a novel mechanism for evoked transmitter release that depends on Ca influx through ionotropic receptors and provides a new potential site for synaptic plasticity in the olfactory bulb.