The M-current (IM) is a time- and voltage-dependent K+ current that persists at slightly depolarized membrane potentials. IM is reduced by muscarinic cholinergic agonists and certain peptides, and is thought to be responsible in part for the slow and late slow excitatory postsynaptic potentials in sympathetic neurons. Recently, we reported that IM in hippocampal neurons was also augmented by somatostatin-14 and -28 suggesting that two different receptors reciprocally regulate one neuronal channel type. Muscarinic effects on IM may be mediated by various components of the phosphatidylinositol phosphate pathway. We now report the involvement of a different second messenger pathway, that generated by phospholipase A2, in the somatostatin-induced augmentation of IM in hippocampal cells. This pathway generates arachidonic acid from which leukotrienes can be produced by lipoxygenases. We find that the IM-augmenting effects of somatostatin are abolished by two substances that can inhibit phospholipase A2, quinacrine and 4-bromophenacyl bromide, and that both arachidonic acid and leukotriene C4 mimic the effects of somatostatin-14 on hippocampal pyramidal neurons in vitro. Arachidonic and somatostatin effects are blocked by a lipoxygenase inhibitor, implicating an arachidonic acid metabolite, perhaps a leukotriene, in the somatostatin effect.