A cholinergic projection from the parabrachial region (PBR) of the brainstem to the visual thalamus has been studied in great detail during the past 20 years. A number of physiological studies have demonstrated that this projection causes a dramatic change in thalamic activity during the transition from sleep to wakefulness. Additionally, the PBR may mediate more subtle changes in thalamic activity as attentional levels fluctuate during the waking state. The synaptic circuitry underlying these events has been identified in the cat thalamus. However, there is currently no anatomical information regarding the distribution of cholinergic receptors in relation to this circuitry. To begin to understand how the PBR projection modulates thalamic activity, we used immunocytochemical techniques to examine the distribution of muscarinic type 2 (M2) receptors in the visual thalamus of the cat. The distribution of M2 receptors correlates well with previous reports of the distribution of cholinergic terminals in the visual thalamus. At the light microscopic level, dense M2 staining was seen in the neuropil of the dorsal lateral geniculate nucleus (dLGN) and pulvinar nucleus and in somata and proximal dendrites of cells in the thalamic reticular nucleus (TRN). In the dLGN and pulvinar nucleus, we quantitatively analyzed the distribution of M2 receptors using electron microscopy. Postembedding immunocytochemistry for gamma aminobutyric acid (GABA) was used to determine whether M2 receptors are present on interneurons or thalamocortical cells. In particular, we examined the distribution of M2 receptors with respect to the known sites of PBR terminations. The dendrites of both thalamocortical cells and interneurons were stained for the M2 receptors in both the glomerular and extraglomerular neuropil. However, the densest staining was found in glomerular GABAergic profiles that displayed the morphology associated with interneuron dendritic terminals (F2 profiles). Our data suggest that M2 receptors play an important role both in blocking thalamic spindle oscillations and in increasing the efficacy of signal transmission during increased attentional states.