Neuronal transmission through hippocampal subfields exhibits a high degree of modulation and appears dependent on the behavioral state and hippocampal EEG. Sensory inputs, which profoundly modify the hippocampal EEG, may be involved in modulating hippocampal excitability. Field responses of the CA1 region, evoked by ipsilateral CA3 or perforant path stimulation, as well as dentate gyrus potentials evoked by perforant path stimulation were recorded in paralyzed and locally anesthetized rats and studied before, during and after sensory stimulation, consisting of gentle stroking of the animal's fur. On some occasions the CA1 was also antidromically driven from the posterior alveus in order to study the recurrent inhibitory loop and paired pulses were applied to the perforant pathway to study recurrent inhibition in the dentate gyrus. Evoked responses were averaged and field excitatory postsynaptic potential (EPSP) slope and population spike (PS) amplitude measured. In addition the positive wave which follows the population spike, which corresponds in part to the recurrent IPSP, was also evaluated. Sensory stimulation, which evoked a high-amplitude 5-6 Hz theta (theta)-rhythm in the hippocampal EEG, drastically depressed the efficacy of Schaffer collateral volleys in discharging the CA1 cells. The EPSP-PS curves, however, were not altered revealing that cellular excitability was unaffected. The inhibitory CA1 loop appeared to be unaltered. In contrast, the dentate gyrus responses to perforant pathway stimulation were enhanced during periods of sensory stimulation and the cellular excitability increased, as judged by the shift to the left of EPSP-PS relation. In addition, the recurrent inhibition appeared to be reduced during sensory stimulation. Present results demonstrate that sensory stimulation causes modulation of information transfer through the hippocampus. This modification of hippocampal transmission may serve to properly gate the information reaching the CA1 and dentate gyrus.