1. In the retina, as in other regions of the vertebrate central nervous system, glutamate receptors mediate excitatory chemical synaptic transmission and are a critical site for the regulation of cellular communication. In this study, retinal horizontal cells from the hybrid less were dissociated in cell culture, voltage clamped by the whole cell recording technique, and the currents evoked by application of excitatory amino acids recorded. 2. Responses to glutamate and its agonist kainate were reduced by approximately 50% in the presence of the nitric oxide (NO) donors sodium nitroprusside and S-nitroso-N-acetylpenicillamine. The effect of these compounds was blocked by the NO scavenger hemoglobin. 3. This effect of NO donors on kainate currents could be mimicked by the application of a membrane permeable guanosine 3',5'-cyclic monophosphate (cGMP) analogue, 8-Br-cGMP. The NO effect was also blocked by application of the guanylate cyclase inhibitor LY-83583, and by a protein kinase G inhibitor peptide. 4. In H1-type horizontal cells, stimulation of endogenous nitric oxide synthase with L-arginine reduced kainate responses, whereas application of D-arginine had no effect. 5. This receptor modulation mechanism may act in concert with other pre- and postsynaptic mechanisms to modify horizontal cell synaptic function according to the adaptational state of the retina and also may protect horizontal cells from glutamate excitotoxicity.