Two methods of evaluating inhibitory sensory processing are prepulse inhibition of acoustic startle (PPI) and gating of auditory evoked potentials. Studies using both methods suggest nicotinic acetylcholinergic receptor modulation of gating, specifically the alpha-bungarotoxin (alpha-BTX) binding site (alpha7 receptor subtype). However, recent assessment of alpha7 null mutant mice failed to demonstrate any effect of the loss of this receptor in either gating paradigm. An alternate approach to assessing the effects of the alpha7 receptor is to reduce its numbers in mature inbred mice, thus, avoiding the twin problems of background and developmental compensation inherent in null mutant mouse studies. Numerous studies have shown that chronic corticosterone (CCS) treatment selectively reduces alpha-BTX binding sites. C3H mice were adrenalectomized and implanted with corticosterone or cholesterol (control) pellets. After 8 days, they were tested in one of the gating paradigms. PPI and auditory gating were significantly diminished in corticosterone-treated mice concomitant with a reduction in alpha-BTX binding in several brain regions. Cholesterol-treated mice had no change in either paradigm. Nicotine treatment (1 mg/kg) produced significant improvement in both paradigms in corticosterone-treated mice. These data agree with previous pharmacological studies suggesting modulation of gating occurs through a nicotinic receptor.