A number of observations, as listed below, suggested a cholinergic basis for inhibitory interactions between photoreceptors of the eye in the nudibranch mollusk Hermissenda crassicornis. The isolated eyes synthesized and accumulated acetylcholine but not other putative neurotransmitter substances. Synthesis and accumulation were determined by electrophoretic separation of products that incorporated radioactive label. Electron microscopic visualization of clear round vesicles within the photoreceptors' somata and axon hillocks was consistent with synthesis and storage of acetylcholine within these cells. Pharmacologic experiments indicated the presence of cholinergic receptors on the terminal branches of the photoreceptors, which are pre and postsynaptic to each other. Carbachol or nicotine produced hyperpolarization of the photoreceptors' membrane accompanied by a reduction of the input resistance. The reversal potential of carbachol-induced hyperpolarization coincided with the reversal potentials of the IPSPs that followed, one for one, impulses of neighboring photoreceptors. Eserine often caused blockade of the IPSPs. This blockade was associated with substantial membrane hyperpolarization and reduction of membrane resistance. Neuronal endings within the optic tract in the area of the photoreceptor's terminal branches stained for acetylcholinesterase. The results of these different experiments, especially when considered together, strongly suggest, although by no means unequivocally demonstrate, that the neurotransmitter of the photoreceptors is acetylcholine.