The striatum is viewed as the principal input structure of the basal ganglia, while the internal pallidal segment (GPi) and the substantia nigra pars reticulata (SNr) are output structures. Input and output structures are linked via a monosynaptic "direct" pathway and a polysynaptic "indirect" pathway involving the external pallidal segment (GPe) and the subthalamic nucleus (STN). According to current schemes, striatal dopamine (DA) enhances transmission along the direct pathway (via D1 receptors), and reduces transmission over the indirect pathway (via D2 receptors). DA also acts on receptors in GPe, GPi, SNr, and STN. Electrophysiologic and other studies in primates rendered parkinsonian by treatment with the dopaminergic neurotoxin MPTP have demonstrated a reduction of neuronal activity of GPe and an increase of neuronal discharge in STN, GPi. and SNr. These findings are compatible with the view that striatal DA loss results in increased activity over the indirect pathway. Prominent bursting, oscillatory discharge patterns, and increased synchronization of neighboring neurons are found throughout the basal ganglia. These may result from changes in the activity of local circuits (e.g., the GPe-STN "pacemaker") or from more global abnormalities of the basal ganglia-thalamocortical network. These findings have been replicated in human patients undergoing microelectrode-guided stereotactic procedures targeted at GPi or STN. PET studies in patients with Parkinson's disease have lent further support to the proposed circuit abnormalities. The current models of basal ganglia function have recently been criticized. For instance, the strict separation of direct and indirect pathways and the segregation of D1 and D2 receptors have been questioned, and the almost complete absence of motor side effects of pallidal or thalamic lesions in human patients and animals is inconsistent. These results suggest that changes in discharge patterns and synchronization between basal ganglia neurons, abnormal network interactions, and compensatory mechanisms are at least as important in the pathophysiology of parkinsonism as changes in discharge rates in individual basal ganglia nuclei. Lesions of GPi or STN are effective in treating parkinsonism, because they reduce or abolish abnormal basal ganglia output, enabling remaining circuits to function more normally.