The generation and function(s) of the signalling molecule cyclic GMP (cGMP) in brain are still poorly understood. One mechanism to raise intracellular cGMP levels is binding of C-type natriuretic peptide (CNP) to a membrane guanylyl cyclase (GC), termed GC-B. Here, we demonstrate an exceptionally strong expression of GC-B in the pineal gland. Crosslinking experiments performed with 125I-Tyr(0)-CNP and membranes from various rat tissues identified the receptor as a 130-kDa protein, expressed at highest levels in pineal membranes. Receptor autoradiography on brain sections confirmed a striking density of CNP binding sites in pineal tissue, whereas binding sites for the related atrial natriuretic peptide (ANP) predominate in other regions of the brain. Incubations of freshly dissected whole pineal glands in either the absence or presence of natriuretic peptides followed by immunohistochemical analyses of cGMP revealed strong accumulations of cGMP in response to CNP but not to ANP in the majority of pinealocytes. Stimulation of soluble GC (sGC) activity by use of sodium nitroprusside (SNP) resulted in a very similar pattern of cGMP immunostaining, indicating a co-expression at high levels of particulate and soluble forms of GC. These findings point to a major role of cGMP signalling in pinealocytes and suggest an important regulatory function for CNP.