The ability of midbrain raphe (MR) cells grafted into serotonin-depleted brain to restore hippocampal responses to synaptically released serotonin was studied using a serotonin-releasing drug, D-fenfluramine (FFA). In normal rats, FFA enhances reactivity of the dentate gyrus (DG) to perforant-path stimulation, while suppressing spontaneous activity. These effects of the drug were dependent on the presence of normal serotonin neurotransmission in the hippocampus. Depletion of brain serotonin markedly attenuated DG reactivity to FFA. MR grafts (4-5 months after transplantation) restored the reactivity of the hippocampus to FFA. Immature MR grafts (3 weeks after transplantation) or septal control grafts could not reproduce the effects of mature grafts. These experiments demonstrate the possible functional incorporation of neural transplants in a host brain and the possible involvement of these grafts in regulation of normal host electrical activity. The combined utilization of a serotonergic graft and a releasing drug (i.e. FFA), in the serotonin-deprived brain, allows the study of serotonin functions in restricted parts of the brain.