N-acetylaspartylglutamate (NAAG) is an abundant neuropeptide in the nervous system, yet its functions are not well understood. Pyramidal neurons of the CA1 sector of acutely prepared hippocampal slices were recorded using the whole-cell patch-clamp technique. At low concentrations (20 microM), NAAG reduced isolated N-methyl-D-aspartate receptor (NMDAR)-mediated synaptic currents or NMDA-induced currents. The NAAG-induced change in the NMDA concentration/response curve suggested that the antagonism was not competitive. However, the NAAG-induced change in the concentration/response curve for the NMDAR co-agonist, glycine, indicated that glycine can overcome the NAAG antagonism. The antagonism of the NMDAR induced by NAAG was still observed in the presence of LY-341495, a potent and selective mGluR3 antagonist. Moreover, in dissociated pyramidal neurons of the CA1 region, NAAG also reduced the NMDA current and this effect was reversed by glycine. These results suggest that NAAG reduces the NMDA currents in hippocampal CA1 pyramidal neurons.