The effect of PGE2 on neurotransmission in the canine tracheal strip dissected free of epithelium was studied in the single sucrose gap and organ bath. PGE2 was a potent inhibitor of the initiation of excitatory junction potentials (ejps) by just submaximal nerve stimulation. In a concentration of 10−9 or 10−8 M PGE2 nearly or completely abolished them. Contractile responses to field stimulation in the sucrose gap at 27 °C or in muscle baths at 37 °C were also reduced or abolished by PGE2 in the same dose range; reductions were greater at low frequency. Responses to acetylcholine were also depressed but significantly less than to field stimulation. These are consistent with major presynaptic as well as some postsynaptic inhibitory actions of PGE2. No evidence was obtained that endogenous PGE2 affected excitatory junction potentials and contractions; i.e. they were stable for hours and unaffected by indomethacin 10−6 and 10−5 M under our conditions. Post-stimulus potentiation of ejps amplitude, maximum at 10 s, was observed and became more marked after the first ejp had been markedly reduced or abolished by PGE2. This potentiation was unaffected by indomethacin. It was suggested that a presynaptic process inhibited by PGE2 might participate in this potentiation. The canine trachea is a useful preparation when studied under the experimental condition used here for study of effects of products of arachidonate on neurotransmission.