We have found that membrane potential in the isolated ciliary epithelium of the shark, Squalus acanthias, is -53 mV. High extracellular potassium or ouabain (10(-5) mol X l-1) decrease the potential, and furosemide (10(-4) mol X l-1) hyperpolarizes it. There is no difference in membrane potential between the cells of the non-pigmented and pigmented layers. Intracellular chloride activity (64 mmol X l-1) was significantly higher than could be predicted from the equilibrium distribution (26 mmol X l-1) across the cell membranes. When furosemide was applied to the aqueous side of the epithelium, intracellular chloride activity decreased to 35 mmol X l-1 and approached electrochemical equilibrium. The data indicate that the ciliary epithelium possesses an active, furosemide-sensitive chloride transport mechanism which could be a Na-Cl or a 1 Na-1 K-2 Cl symport.