Estrogen modulates learning and memory in ovariectomized and naturally cycling female rats, especially in tasks using spatial learning and navigation. Estrogen also modulates cholinergic function in various forebrain structures. Past studies have shown positive correlations between hippocampal ACh output and performance on hippocampus-dependent tasks. The present study examined whether estradiol replacement would potentiate hippocampal ACh release during place learning. In vivo microdialysis and HPLC were used to measure extracellular ACh levels in the hippocampus of ovariectomized female rats that had received s.c. injections of 17beta-estradiol (10 microg) or sesame oil (vehicle treatment) 48 and 24h prior to training on a place task. Estrogen did not alter baseline levels of extracellular ACh in the hippocampus. During training, hippocampal ACh increased in ovariectomized rats regardless of estrogen status. However, while estradiol did not enhance learning in this experiment, estradiol significantly potentiated the increase in hippocampal ACh release seen during place training. This represents the first demonstration of on-line assessment of ACh output in hippocampus during learning in female rats and suggests that estrogen-dependent modulation of ACh release during training might control activation of different neural systems used during learning.