The generation of toxic concentrations of nitric oxide by the inducible nitric oxide synthase expressed in microglia and other brain cell types is frequently invoked as a causative factor in neurodegeneration. Experiments were carried out on slice cultures of rat hippocampus to test this hypothesis. Exposure of the slices to bacterial lipopolysaccharide plus interferon-gamma led to a time-dependent expression of functional inducible nitric oxide synthase that was found only in microglia. Microglial activation by other means, such as physical damage, was not associated with inducible nitric oxide synthase expression. Damage and cell death in slices expressing inducible nitric oxide synthase was evaluated over a period of 6 days, but none was found. Consistent with this result, cGMP measurements indicated that the average local nitric oxide concentration remained in the low nanomolar range. When the microglial population was expanded to a density three-fold above normal by applying granulocyte-macrophage colony stimulating factor, however, lipopolysaccharide plus interferon-gamma provoked neurodegeneration that could be blocked by an inducible nitric oxide synthase inhibitor. The associated nitric oxide concentration in the slices was saturating for guanylyl cyclase-coupled nitric oxide receptors, signifying at least 10 nM. It is concluded that inducible nitric oxide synthase is expressed in microglia only in response to specific stimuli involving the innate immune system, and that the resulting level of nitric oxide in intact brain tissue is normally too low to inflict damage directly. Quantities of nitric oxide sufficient to contribute directly or indirectly to pathology could be produced should the density of microglia become high enough, although caution must be exercised in extrapolating this finding to the human brain in vivo.