Substance P (SP) is the major endogenous ligand for neurokinin 1 (NK1) receptors and, together with acetylcholine, has an important role in motivated behaviors involving the limbic shell and motor core of the nucleus accumbens (NAc). To determine the functional sites for SP activation of NK-1 receptors and potential interactions with cholinergic neurons in these regions, the authors examined the electron microscopic immunocytochemical localization either of antisera against the NK1 receptor or of the NK1 receptor and either 1) SP or 2) the vesicular acetylcholine transporter (VAchT) in rat NAc. In both the NAc shell and core, NK1 receptor labeling was localized mainly to somatic and dendritic plasma membranes and nearby endosomal organelles in aspiny neurons. In sections through the ventromedial shell that were processed for NK1/SP labeling, 46% of the NK1-immunoreactive dendrites (n = 603 dendrites) showed symmetric or appositional contacts with SP-containing terminals. These terminals and several others that formed symmetric synapses also occasionally were immunoreactive for NK1 receptors. Analysis of the shell region for NK1/VAchT labeling showed that 61% of the total immunoreactive dendrites (n = 534 dendrites) contained NK1 receptors without VAchT, 29% contained both products, and 10% contained VAchT only. Many of the labeled somata and dendrites also received synaptic contact from VAchT-containing terminals. These findings suggest that, in the NAc, NK1 receptors are recycled through endosomal compartments and play a role in modulating mainly the postsynaptic responses, but also the presynaptic release, of SP and/or inhibitory neurotransmitters onto aspiny interneurons, some of which are cholinergic.