Modafinil is a well-tolerated medication for excessive sleepiness, attention-deficit disorder, cocaine dependence and as an adjunct to antidepressants with low propensity for abuse. We investigated the modafinil action on identified dopaminergic and GABAergic neurons in the ventral tegmental area (VTA) and substantia nigra (SN) of rat brain slices. Modafinil (20 μM) inhibited the firing of dopaminergic, but not GABAergic neurons. This inhibition was maintained in the presence of tetrodotoxin and was accompanied by hyperpolarization. Sulpiride (10 μM), a D2-receptor antagonist, but not prazosine (20 μM, an α1-adrenoreceptor blocker) abolished the modafinil action. Inhibition of dopamine reuptake with a low dose of nomifensine (1 μM) reduced the firing of DA neurons in a sulpiride-dependent manner and blunted the effect of modafinil. On acutely isolated neurons, modafinil evoked D2-receptor-mediated outward currents in tyrosine-hydroxylase positive cells, identified by single-cell RT–PCR, which reversed polarity near the K+ equilibrium potential and were unchanged in the presence of nomifensine. Thus modafinil directly inhibits DA neurons through D2 receptors.