The brain oxytocin system has served as a distinguished model system in neuroendocrinology to study detailed mechanisms of intracerebral release, in particular of somatodendritic release, and its behavioural and neuroendocrine consequences. It has been shown that oxytocin is released within various brain regions, but evidence for dendritic release is limited to the main sites of oxytocin synthesis, i.e. the hypothalamic SON (supraoptic nucleus) and PVN (paraventricular nucleus). In the present paper, stimuli of dendritic release of oxytocin and the related neuropeptide vasopressin are discussed, including parturition and suckling, i.e. the period of a highly activated brain oxytocin system. Also, exposure to various pharmacological, psychological or physical stressors triggers dendritic oxytocin release, as monitored by intracerebral microdialysis within the SON and PVN during ongoing behavioural testing. So far, dendritic release of the neuropeptide has only been demonstrated within the hypothalamus, but intracerebral oxytocin release has also been found within the central amygdala and the septum in response to various stimuli including stressor exposure. Such a locally released oxytocin modulates physiological and behavioural reproductive functions, emotionality and hormonal stress responses, as it exerts, for example, pro-social, anxiolytic and antistress actions within restricted brain regions. These discoveries make oxytocin a promising neuromodulator of the brain for psychotherapeutic intervention and treatment of numerous psychiatric illnesses, for example, anxiety-related diseases, social phobia, autism and postpartum depression.