We have investigated the relationship between muscarinic agonist-stimulated phosphoinositide (PI) hydrolysis and electrophysiological responses in rat hippocampal slice preparations. In a previous extracellular study, we found that muscarinic agonists at concentrations that stimulate PI hydrolysis result in a biphasic firing response; an initial increase in firing followed by loss of firing at higher concentrations. To test the hypothesis that variability in obtaining consistent loss of firing is related to depletion of intracellular inositol, we investigated the effects of adding exogenous inositol to the buffer. We now report that concentrations of inositol similar to those in cerebral spinal fluid (30-100 microM) augment carbamylcholine (carbachol, CCh) mediated loss of firing and [3H]inositol-1,3,4,5-tetrakisphosphate ([3H]Ins(1,3,4,5)P4) formation. Inhibition of firing produced by 30 microM CCh in the presence of inositol was associated with a sustained depolarization of 20-25 mV, an increased slope resistance in the depolarized range (-60 to -40 mV), and a parallel shift in the hyperpolarized (-100 to -70 mV) range of the voltage-current curve and increased frequency of spontaneous IPSPs. Under voltage-clamp, measurements of the M-current (IM) showed sustained inactivation by CCh with reversal after washout of CCh. Manual depolarization of cells by current injection to the same level of depolarization as attained with CCh did not usually lead to the same loss of firing. These findings suggest that IM, and possibly other voltage-independent currents or ion pumps, may cause loss of firing only in part through a depolarization blockade of firing and not through desensitization. Furthermore, CCh treatment without inositol did not depolarize neurons as much as CCh with inositol, and usually did not cause a delayed loss of firing. Brain slice preparations may thus require physiological concentrations of inositol to show consistent or maximum phosphoinositide-mediated electrophysiological responses.