Experiments were designed to study the effect of the beta adrenergic antagonist, carteolol, on the endothelium-dependent responsiveness of isolated arteries. Rings of canine coronary arteries were suspended in organ chambers for isometric tension recording; carteolol inhibited the relaxation to isoproterenol and abolished the difference in responsiveness to the beta adrenergic agonist between rings with and without endothelium. Carteolol did not cause endothelium-dependent relaxations of femoral or coronary arteries. In bioassay experiments, carteolol augmented the basal release of relaxing factors from the endothelium of the femoral artery; this effect was prevented by indomethacin. In rings of femoral arteries, carteolol increased the endothelium-dependent relaxations induced by the alpha-2 adrenergic agonist UK 14,304; this was not affected by indomethacin but prevented by propranolol. Carteolol did not modify the endothelium-dependent relaxations to acetylcholine, adenosine diphosphate, bradykinin, thrombin and the Ca+-ionophore A23187. Carteolol inhibited the endothelium-dependent hypoxic contraction of the canine coronary artery. It did not affect endothelium-dependent contractions to acetylcholine in the aorta of the spontaneously hypertensive rat. These experiments suggest that carteolol facilitates the abluminal release of endothelium-dependent relaxing factor caused by alpha-2 adrenergic activation, and causes the intraluminal release of vasodilator prostaglandins. The compound prevents the endothelium-dependent contractions which are not mediated by products of cyclooxygenase. These actions may contribute to the vasodilatator properties of carteolol in the intact organism.