A subpopulation of neurones in the cerebellar nuclei projects to the inferior olive, the source of the climbing fibre input to the cerebellum. This nucleo-olivary projection follows the zonal and, probably also, the microzonal arrangement of the cerebellum so that closed loops are formed between the neurones in the olive, the cerebellar cortex and the nuclei. The nucleo-olivary pathway is GABAergic, but several investigators argue that its main effect is to regulate electrotonic coupling between cells in the inferior olive rather than inhibit the olive. However, there is now strong evidence that the nucleo-olivary fibres do inhibit the olive. Three functions have been suggested for this inhibition: (i) feedback control of background activity in Purkinje cells, (ii) feedback control of learning, and (iii) gating of olivary input in general. Evidence is consistent with (i) and (ii). Activity in the nucleo-olivary pathway suppresses both synaptic transmission and background activity in the olive. When learned blink responses develop, the blink related part of the olive is inhibited while blinks are produced. When the nucleo-olivary pathway is interrupted, there is a corresponding increase in complex spike discharge in Purkinje cells followed by a strong suppression of simple spike firing. Stimulation of the pathway has the opposite results. It is concluded that the nucleo-olivary fibres are inhibitory and that they form a number of independent feedback loops, each one specific for a microcomplex, that regulate cerebellar learning as well as spontaneous activity in the olivo-cerebellar circuit.