The quality of the signal a retinal ganglion cell transmits to the brain is important for preception because it sets the minimum detectable stimulus. The ganglion cell converts graded potentials into a spike train with a selective filter but in the process adds noise. To explore how efficiently information is transferred to spikes, we measured contrast detection threshold and increment threshold from graded potential and spike responses of brisk-transient ganglion cells. Intracellular responses to a spot flashed over the receptive field center of the cell were recorded in an intact mammalian retina maintained in vitro at 37 degrees C. Thresholds were measured in a single-interval forced-choice procedure with an ideal observer. The graded potential gave a detection threshold of 1.5% contrast, whereas spikes gave 3.8%. The graded potential also gave increment thresholds approximately twofold lower and carried approximately 60% more gray levels. Increment threshold "dipped" below the detection threshold at a low contrast (<5%) but increased rapidly at higher contrasts. The magnitude of the "dipper" for both graded potential and spikes could be predicted from a threshold nonlinearity in the responses. Depolarization of the cell by current injection reduced the detection threshold for spikes but also reduced the range of contrasts they can transmit. This suggests that contrast sensitivity and dynamic range are related in an essential trade-off.