1. The effect of nitric oxide on the efficacy of synaptic transmission in the chick ciliary ganglion of post-hatched birds has been determined by use of the size of the postganglionic compound action potential resulting from chemical transmission through the ganglion as a measure of synaptic efficacy. 2. Sodium nitroprusside (100 microM) increased the synaptic efficacy by an average 26%. This is likely to be due to its ability to release nitric oxide, as potassium ferricyanide (100 microM) did not cause a potentiation. Sodium azide (100 microM), shown in sympathetic ganglia to stimulate production of cyclic GMP, did not modulate synaptic efficacy significantly. 3. 8-Br-cyclic-GMP (100 microM) increased synaptic efficacy by an average 61%. The addition of 8-Br-cyclic-AMP (100 microM) had less effect, increasing transmission by on average 46%. 4. The nitric oxide synthase blocker, NG-nitro-L-arginine methyl ester (L-NAME, 100 microM) was added prior to the tetanic stimulation of the preganglionic nerves at 30 Hz for 20 s, a procedure known to produce both post-tetanic potentiation and long-term potentiation of synaptic transmission through the ganglion. L-NAME reduced the long-term potentiation by an average of 47% but did not significantly change the post-tetanic potentiation. 5. Following the brief application of 8-Br-cyclic AMP, 8-Br-cyclic GMP and sodium nitroprusside there was an enhancement of the efficacy of synaptic transmission that persisted after the withdrawal of the drugs. The maximum increase in synaptic efficacy following the brief addition of 8-Br-cyclic GMP was 116%, sodium nitroprusside was 110% and 8-Br-cyclic AMP was 126%.6. These results suggest that nitric oxide modulates synaptic transmission through the ganglion by acting on an endogenous guanylate cyclase that produces cyclic GMP.