A key neurotrophin responsible for the survival and function of basal forebrain (BF) cholinergic neurons is brain-derived neurotrophic factor (BDNF). A number of studies now indicate that a source of this factor may be BF astrocytes. This study was designed to define the role of BF-astrocyte-derived BDNF on cholinergic neurons. Moreover, it investigated regulatory events that modulate BDNF content and release. In initial work BDNF derived from BF-astrocyte-conditioned medium (ACM) was found to increase both numbers of BF acetylcholinesterase (AChE+) cholinergic neurons and the cholinergic synthetic enzyme choline acetyltransferase (ChAT). Western blots, immunocytochemistry and pharmacological inhibition studies revealed that glutamate, through group I metabotropic glutamate receptors (mGluR), increases the intracellular levels of BDNF in BF astrocytes in culture, as well as its release. Furthermore, the release of BDNF is mediated by the actions of PLC, IP3 and internal stores of Ca2+. These results suggest that BF astrocytes serve as local sources of BDNF for cholinergic neurons, and that they may be regulated as such by the neuronal signal, glutamate, through the mediation of group I metabotropic receptors and the PLC pathway.