Astrocytes have, until recently, been thought of as the passive supporting elements of the central nervous system. However, recent developments suggest that these cells actually play a crucial and vital role in the overall physiology of the brain. Astrocytes selectively express a host of cell membrane and nuclear receptors that are responsive to various neuroactive compounds. In addition, the cell membrane has a number of important transporters for these compounds. Direct evidence for the selective co-expression of neurotransmitters, transporters on both neurons and astrocytes, provides additional evidence for metabolic compartmentation within the central nervous system. Oxidative stress as defined by the excessive production of free radicals can alter dramatically the function of the cell. The free radical nitric oxide has attracted a considerable amount of attention recently, due to its role as a physiological second messenger but also because of its neurotoxic potential when produced in excess. We provide, therefore, an in-depth discussion on how this free radical and its metabolites affect the intra and intercellular physiology of the astrocyte(s) and surrounding neurons. Finally, we look at the ways in which astrocytes can counteract the production of free radicals in general by using their antioxidant pathways. The glutathione antioxidant system will be the focus of attention, since astrocytes have an enormous capacity for, and efficiency built into this particular system.