The cholinergic anti-inflammatory pathway is a neural mechanism that suppresses the innate inflammatory response and controls inflammation employing acetylcholine as the key endogenous mediator. In this study, we investigated the effects of the cholinergic agonists, physostigmine and donepezil, on neurodegeneration, inflammation and oxidative stress during oxygen toxicity in the developing rat brain. The aim of this study was to investigate the level of neurodegeneration, expression of proinflammatory cytokines, glutathione and lipid peroxidation after hyperoxia and treatment with the acetylcholinesterase (AChE) inhibitors, physostigmine and donepezil in the brain of neonatal rats. Six-day-old Wistar rats were exposed to 80% oxygen for 12-24 h and received 100 μg/kg physostigmine or 200 μg/kg donepezil intraperitoneally. Sex-matched littermates kept in room air and injected with normal saline, physostigmine or donepezil served as controls. Treatment with both inhibitors significantly reduced hyperoxia-triggered activity of AChE, neural cell death and the upregulation of the proinflammatory cytokines IL-1β and TNF-α in the immature rat brain on the mRNA and protein level. In parallel, hyperoxia-induced oxidative stress was reduced by concomitant physostigmine and donepezil administration, as shown by an increased reduced/oxidized glutathione ratio and attenuated malondialdehyde levels, as a sign of lipid peroxidation. Our results suggest that a single treatment with AChE inhibitors at the beginning of hyperoxia attenuated the detrimental effects of oxygen toxicity in the developing brain and may pave the way for AChE inhibitors, which are currently used for the treatment of Alzheimer's disease, as potential candidates for adjunctive neuroprotective therapies to the immature brain.