1. The properties of the cholinergic neurons of the rat medial septum and nucleus of the diagonal band of Broca (MS/DBB) were studied using whole cell patch-clamp recordings in an in vitro slice preparation. 2. Both the transmitter phenotype and the intrinsic membrane properties of 56 MS/DBB neurons were determined post hoc by visualizing intracellularly deposited biocytin with fluorescent avidin and endogenous choline acetyltransferase with immunofluorescence. Twenty seven of 28 MS/DBB neurons exhibiting both a prominent slow afterhyperpolarization (sAHP) following a single action potential and anomalous rectification were identified as cholinergic. The remaining 28 neurons exhibited other intrinsic membrane properties and none were choline acetyltransferase immunoreactive. 3. The sAHP in MS/DBB cholinergic neurons was blocked reversibly either by reducing extracellular calcium or addition of 100 microM cadmium and irreversibly blocked by 30 nM apamin, suggesting that the sAHP is produced by an apamin-sensitive calcium-activated potassium conductance. 4. MS/DBB cholinergic neurons also exhibited a postspike depolarizing afterpotential (DAP) preceeding the sAHP. Both the DAP and the sAHP were blocked when extracellular calcium was lowered as well as in the presence of 10-50 microM NiCl2. Application of 500 nM omega-conotoxin also reduced the sAHP, while leaving the DAP intact. These data suggest that both transient and high-threshold calcium conductances contribute to generation of the sAHP. 5. When depolarized, cholinergic neurons fired slowly (2-4 Hz) and regularly with little evidence of spike frequency adaptation. When the sAHP was blocked with apamin, the instantaneous frequency of firing increased and the neuron now exhibited prominent spike frequency adaptation. 6. Serotonin (5-HT) reversibly suppressed the sAHP in MS/DBB cholinergic neurons and altered the firing pattern from slow regular discharge to one which exhibited modest spike frequency adaptation. 7. It was concluded that the sAHP limits the firing rate of MS/DBB cholinergic neurons and that physiologically relevant supression of the sAHP by 5-HT may result in state-dependent changes in the discharge pattern of MS/DBB cholinergic neurons.