Toluene, a psychoactive volatile solvent found in adhesives and other products, is inhaled for its euphoric and intoxicating effects. Toluene inhalation additionally results in cognitive disturbances including impairments in select types of spatial and non-spatial memory, which converging evidence suggests may involve neurons of the dentate gyrus. In the present study we examined the effects of acute binge-like (~5000ppm) toluene inhalation on dentate gyrus granule cell output and perforant path synaptic transmission, using extracellular field potential recordings in anesthetized adult rats in vivo. We found that toluene rapidly and reversibly increased or decreased the amplitudes of evoked population spikes from granule cells over a wide range of stimulation intensities. These changes in granule cell output could not be accounted for by changes in perforant path action potential discharge or presynaptic neurotransmitter release. A marked decrease in the power of the theta rhythm measured within the dentate gyrus was additionally noted. Overall our results suggest that inhalation of abuse-relevant concentrations of toluene changes the readout of perforant path inputs by dentate gyrus granule cells, putatively through a postsynaptic mechanism, and may contribute to explanations for specific learning and memory deficits associated with toluene inhalation.