Acetylcholine (ACh), the major parasympathetic neurotrans- mitter, is released by intrapancreatic nerve endings during the preabsorptive and absorptive phases of feeding. In-cells, ACh binds to muscarinic M3 receptors and exerts complex effects, which culminate in an increase of glucose (nutrient)- induced insulin secretion. Activation of PLC generates diacyl- glycerol. Activation of PLA2 produces arachidonic acid and lysophosphatidylcholine. These phospholipid-derived mes- sengers, particularly diacylglycerol, activate PKC, thereby in- creasing the efficiency of free cytosolic Ca2 concentration ((Ca2)c) on exocytosis of insulin granules. IP3, also produced by PLC, causes a rapid elevation of (Ca2)c by mobilizing Ca 2 from the endoplasmic reticulum; the resulting fall in Ca2 in the organelle produces a small capacitative Ca2 entry. ACh also depolarizes the plasma membrane of -cells by a Na- dependent mechanism. When the plasma membrane is al- ready depolarized by secretagogues such as glucose, this ad- ditional depolarization induces a sustained increase in (Ca2)c. Surprisingly, ACh can also inhibit voltage-dependent Ca2 channels and stimulate Ca2 efflux when (Ca2)c is ele- vated. However, under physiological conditions, the net effect of ACh on (Ca2)c is always positive. The insulinotropic effect of ACh results from two mechanisms: one involves a rise in (Ca2)c and the other involves a marked, PKC-mediated in- crease in the efficiency of Ca2 on exocytosis. The paper also discusses the mechanisms explaining the glucose dependence of the effects of ACh on insulin release. (Endocrine Reviews 22: 565- 604, 2001)