The glomerular layer of the olfactory bulb (OB) receives heavy cholinergic input from the horizontal limb of the diagonal band of Broca (HDB) and expresses both muscarinic and nicotinic acetylcholine (ACh) receptors. However, the effects of ACh on OB glomerular odor responses remain unknown. Using calcium imaging in transgenic mice expressing the calcium indicator GCaMP2 in the mitral/tufted cells, we investigated the effect of ACh on the glomerular responses to increasing odor concentrations. Using HDB electrical stimulation and in vivo pharmacology, we find that increased OB ACh leads to dynamic, activity-dependent bi-directional modulation of glomerular odor response due to the combinatorial effects of both muscarinic and nicotinic activation. Using pharmacological manipulation to reveal the individual receptor type contributions, we find that m2 muscarinic receptor activation increases glomerular sensitivity to weak odor input whereas nicotinic receptor activation decreases sensitivity to strong input. Overall, we found that ACh in the OB increases glomerular sensitivity to odors and decreases activation thresholds. This effect, along with the decreased responses to strong odor input, reduces the response intensity range of individual glomeruli to increasing concentration making them more similar across the entire concentration range. As a result, odor representations are more similar as concentration increases.