Within the second synaptic layer of the retina, bipolar cell (BC) output to ganglion cells is regulated by inhibitory input to BC axon terminals. GABA(A) receptors (GABA(A)Rs) mediate rapid synaptic currents in BC terminals, whereas GABA(C) receptors (GABA(C)Rs) mediate slow evoked currents and a tonic current, which is strongly regulated by GAT-1 GABA transporters. We have used voltage-clamp recordings from BC terminals in goldfish retinal slices to determine the source of GABA for activation of these currents. Inhibition of vesicular release with concanamycin A or tetanus toxin significantly inhibited GABA(A)R inhibitory postsynaptic currents and glutamate-evoked GABA(A)R and GABA(C)R currents but did not reduce the tonic GABA(C)R current, which was also not dependent on extracellular Ca(2+). The tonic current was strongly potentiated by inhibition of GABA transaminase, under both normal and Ca(2+)-free conditions, and was activated by exogenous taurine; however inhibition of taurine transport had little effect. The tonic current was unaffected by GAT-2/3 inhibition and was potentiated by GAT-1 inhibition even in the absence of vesicular release, indicating that it is unlikely to be evoked by reversal of GABA transporters or by ambient GABA. In addition, GABA release does not appear to occur via hemichannels or P2X(7) receptors. BC terminals therefore exhibit two forms of GABA(C)R-mediated inhibition, activated by vesicular and by nonvesicular GABA release, which are likely to have distinct functions in visual signal processing. The tonic GABA(C)R current in BC terminals exhibits similar properties to tonic GABA(A)R and glutamate receptor currents in the brain.