More than 20 neuropeptides have been localized in the endocrine hypothalamus. They may exert a neurohormonal effect on the pituitary or innervate other neurons (intranuclear, intrahypothalamic or extrahypothalamic) and act as neurotransmitters. Many of the hypothalamic neuropeptides are synthesized as inactive precursors that are activated by proteolysis during axonal transport from the cell body to the synapse. Studies in which the paraventricular nuclei were bilaterally destroyed have shown that the neuroendocrine cells in the hypothalamus show functional plasticity and cells that do not usually make detectable quantities of a particular neuropeptide may be activated to do so. Within the hypothalamic nuclei are dense networks of synaptic connections among neurons synthesizing the same or different neuropeptides. These local circuits may coordinate the activities of peptidergic neurons in a hypothalamic nucleus. Hypothalamic neurons project axons to the median eminence-pituitary stalk and the posterior pituitary, also to nuclei within the hypothalamus and to extrahypothalamic areas such as the lower brainstem. Peptidergic neurons in the hypothalamus can have combined neurohormonal and neurotransmitter activities mediated by axon terminals on portal capillaries and other hypothalamic nuclei. Double labelling immunohistochemistry has been used to demonstrate reciprocal connections between peptidergic neurons in the hypothalamus, such as those synthesizing growth hormone-releasing hormone and somatostatin.