1. In acutely isolated hippocampal cells, NMDA and glutamate application suppressed GABAA receptor-mediated responses. We studied the cellular events underlying the interaction between the two classes of receptors by using a whole-cell voltage-clamp approach. 2. Following an NMDA application, an outward current mediated by GABAA receptor activation (GABA response) was suppressed for up to 12 s. The suppression of the GABA response was reduced when Ca2+ in the extracellular solution was replaced by Ba2+ or when intracellular BAPTA (1,2-bis(O-aminophenoxy)ethane-N,N,N',N'-tetraacetic acid) was increased from 1 to 10 mM. 3. Replacing ATP in the intracellular solution by adenosine-5'-O-3-thiotriphosphate reduced the suppressive effect of NMDA application on the GABA response. Okadaic acid, a phosphatase inhibitor, also prevented the NMDA-induced suppression of the GABA response. In addition, when the intracellular perfusing solution contained the calcineurin autoinhibitory fragment (50 microM), suppression of the GABA response by the NMDA current was also reduced. 4. Intracellular perfusion of an activated form of the Ca(2+)-dependent phosphatase, calcineurin, suppressed GABA responses. 5. The results show that NMDA responses elicited in hippocampal neurones transiently suppressed GABA responses. The data suggest that the functional linkage of the NMDA response with the GABA response was established via a Ca(2+)-dependent dephosphorylation process.