1. The cellular mechanisms by which neurons of the ferret perigeniculate nucleus (PGN) participate in the generation of spindle waves and slowed absence seizure-like oscillations were investigated with intracellular and extracellular recording techniques in geniculate slices maintained in vitro. 2. During spindle wave generation, PGN neurons generated repetitive (2-9 Hz) high frequency (up to 500 Hz) burst discharges mediated by the activation of a low threshold Ca2+ spike by the arrival of barrages of excitatory postsynaptic potentials (EPSPs). In most PGN cells at resting membrane potentials (-60 to -70 mV) spindle waves were associated with a progressive hyperpolarization that persisted as a prolonged after-hyperpolarization. 3. The EPSPs occurring in PGN cells were highly synchronized with burst firing in the neighbouring portion of the dorsal lateral geniculate nucleus (LGNd) and were intermixed with short duration inhibitory postsynaptic potentials (IPSPs). After block of GABAergic receptors, the EPSPs occurring during the generation of spindle waves reversed polarity at around 0 mV. In addition, these EPSPs were completely blocked with the bath application of the non-NMDA receptor antagonist 6-cyano-7-nitroquinoxaline-2,3-dione (CNQX), as was spindle wave generation in both the PGN and LGNd. 4. Slowing the intraspindle frequency to 2-4 Hz with pharmacological block of GABAA receptors resulted in a marked increase in the intensity of burst firing by PGN cells such that the number of action potentials per burst increased from a maximum of thirteen to a maximum of sixty. Block of GABAA receptors also resulted in a marked increase in the amplitude and duration of the EPSP barrages arriving from the relay laminae during generation of the slowed oscillation. 5. These findings indicate that spindle waves are generated in the ferret LGNd in vitro through an interaction between the GABAergic neurons of the PGN and relay neurons, such that burst firing in relay neurons activates a barrage of EPSPs and a subsequent low threshold Ca2+ spike in PGN cells. This activation of PGN neurons inhibits a substantial number of relay cells, a few of which rebound burst after this IPSP, thus starting the cycle again. Block of GABAA receptors results in a marked enhancement of activity in PGN cells through increased excitation from relay cells and disinhibition from neighbouring PGN cells. This increased activity in PGN neurons results in a markedly enhanced activation of GABAB receptors in relay neurons and the subsequent generation of paroxysmal activity that is similar to that associated with absence seizures.