Prenatal exposure to cigarette smoke is known to produce lasting arousal, attentional and cognitive deficits in humans. The pedunculopontine nucleus (PPN), as the cholinergic arm of the reticular activating system (RAS), is known to modulate arousal, waking and rapid eye movement (REM) sleep. REM sleep decreases between 10 and 30 days postnatally in the rat, especially at 12-21 days. Pregnant dams were exposed to 350 ml of cigarette smoke for 15 min, 3 times per day, from day E14 until birth, and the pups allowed to mature. Intracellularly recorded PPN neurons in 12-21 day rat brainstem slices were tested for intrinsic membrane properties, including the hyperpolarization-activated cation current Ih, which is known to drive oscillatory activity. Type II (A-current) PPN cells from 12-16 day old offspring of treated animals had a 1/2max Ih amplitude of (mean +/- SE) 4.1 +/- 0.9 mV, while 17-21 day cells had a higher 1/2max Ih of 9.9 +/- 1.1 mV (p < 0.0001). Cells from 12-16 day old control brainstems had a 1/2max Ih of 1.3 +/- 0.1 mV, which was lower (p < 0.05) than in cells from prenatally treated offspring; while 17-21 day old cells from controls had a 1/2max Ih of 3.3 +/- 0.3 mV, which was also lower (p < 0.01) than in cells from prenatally treated offspring. In addition, changes in resting membrane potential [control -65. +/- 0.9 mV (n=32); exposed -55.0 +/- 1.4 mV (n = 27) (p < 0.0001)], and action potential (AP) threshold [control -56.5 +/- 0.7 mV (n = 32), exposed -47.0 +/- 1.4 mV (n = 27) (p < 0.0001)], suggest that prenatal exposure to cigarette smoke induced marked changes in cells in the cholinergic arm of the RAS, rendering them more excitable. Such data could partially explain the differences seen in individuals whose parents smoked during pregnancy, especially in terms of their hypervigilance and increased propensity for attentional deficits and cognitive/behavioral disorders.