M(1) muscarinic acetylcholine receptors (mAChRs) represent a viable target for treatment of multiple disorders of the central nervous system (CNS) including Alzheimer's disease and schizophrenia. The recent discovery of highly selective allosteric agonists of M(1) receptors has provided a major breakthrough in developing a viable approach for the discovery of novel therapeutic agents that target these receptors. Here we describe the characterization of two novel M(1) allosteric agonists, VU0357017 and VU0364572, that display profound differences in their efficacy in activating M(1) coupling to different signaling pathways including Ca(2+) and β-arrestin responses. Interestingly, the ability of these agents to differentially activate coupling of M(1) to specific signaling pathways leads to selective actions on some but not all M(1)-mediated responses in brain circuits. These novel M(1) allosteric agonists induced robust electrophysiological effects in rat hippocampal slices, but showed lower efficacy in striatum and no measureable effects on M(1)-mediated responses in medial prefrontal cortical pyramidal cells in mice. Consistent with these actions, both M(1) agonists enhanced acquisition of hippocampal-dependent cognitive function but did not reverse amphetamine-induced hyperlocomotion in rats. Together, these data reveal that M(1) allosteric agonists can differentially regulate coupling of M(1) to different signaling pathways, and this can dramatically alter the actions of these compounds on specific brain circuits important for learning and memory and psychosis.