Within the rat hippocampal formation, cholinergic afferents and mu-opioid receptors (MORs) are involved in many crucial learning processes, including those associated with drug reward. Pharmacological data, and the overlapping distributions of cholinergic and mu-opioid systems, particularly in the dentate gyrus, suggest that MOR activation is a potential mechanism for endogenous opioid modulation of cholinergic activity. To date, anatomical evidence supporting this has not been reported. To delineate the relationship between cholinergic afferents and MOR-containing processes in the dentate gyrus, hippocampal sections were dually immunolabeled for vesicular acetylcholine transporter (VAChT) and MOR-1 and examined by electron microscopy. VAChT immunoreactivity was in unmyelinated axons and axon terminals, and was most often associated with small synaptic vesicles. MOR immunoreactivity was found in axons, axon terminals and, to a lesser extent, perikarya, which resembled GABAergic basket cells. Semi-quantitative ultrastructural analysis revealed that from 5% to 13% (depending on laminar location) of VAChT-immunoreactive (ir) presynaptic profiles contained MOR immunoreactivity. Additionally, 7% of VAChT-ir presynaptic profiles directly apposed MOR-ir axons and terminals, and there were almost no appositions to MOR-ir dendrites. These data suggest that opioids may directly and indirectly modulate acetylcholine release and/or reuptake. In the hilus and molecular layer, 4% of VAChT-ir terminals contacted dendritic shafts that were also contacted by MOR-ir terminals. This suggests that cholinergic afferents and MOR-containing afferents can converge on granule cell dendrites (which are restricted to the molecular layer) and on interneuron dendrites in the hilus. The results of this study provide ultrastructural evidence for direct and indirect modulation of cholinergic systems by mu-opioids in the hippocampal formation.