The brain somehow merges visual information with the behavioral context in which it is being processed, a task that is often attributed to the cerebral cortex. We have identified a new role of the gaseous neurotransmitter, nitric oxide (NO), in the early selective enhancement of corticogeniculate communication that may participate in this process at the level of the thalamus. Visual information is dynamically gated through the thalamus by brainstem neurons that release acetylcholine and NO. Using in vitro electrophysiology, we characterized NO effects on excitatory postsynaptic potentials and currents (EPSCs) elicited from retinal and cortical pathways in the lateral geniculate nucleus of the ferret. NO selectively and reversibly increased cortically-evoked postsynaptic responses, and this effect was mimicked by cyclic guanosine 3',5'-monophosphate (cGMP). Conversely, NO inhibited retinally-evoked responses independently of cGMP. We demonstrated that these differential effects were specific to postsynaptic N-methyl-d-aspartate (NMDA) receptors by studying treatment effects on pharmacologically isolated EPSCs from each pathway. We propose that when brainstem activity is increased during behavioral arousal or rapid eye movement sleep, NO may increase the relative sensitivity of relay neurons to corticogeniculate feedback. The net effect of these changes in synaptic processing may be to selectively suppress peripheral information while unifying data carried by reentrant corticogeniculate loops with the behavioral context in which the visual information is processed.