In addition to affecting respiration and vascular tone, deviations from normal CO₂ alter pH, consciousness, and seizure propensity. Outside the brainstem, however, the mechanisms by which CO₂ levels modify neuronal function are unknown. In the hippocampal slice preparation, increasing CO₂, and thus decreasing pH, increased the extracellular concentration of the endogenous neuromodulator adenosine and inhibited excitatory synaptic transmission. These effects involve adenosine A₁ and ATP receptors and depend on decreased extracellular pH. In contrast, decreasing CO₂ levels reduced extracellular adenosine concentration and increased neuronal excitability via adenosine A₁ receptors, ATP receptors, and ecto-ATPase. Based on these studies, we propose that CO₂-induced changes in neuronal function arise from a pH-dependent modulation of adenosine and ATP levels. These findings demonstrate a mechanism for the bidirectional effects of CO₂ on neuronal excitability in the forebrain.