The orexin neurones play an essential role in driving arousal and in maintaining normal wakefulness. Lack of orexin neurotransmission produces a chronic state of hypoarousal characterized by excessive sleepiness, frequent transitions between wake and sleep, and episodes of cataplexy. A growing body of research now suggests that the basal forebrain (BF) may be a key site through which the orexin-producing neurones promote arousal. Here we review anatomical, pharmacological and electrophysiological studies on how the orexin neurones may promote arousal by exciting cortically projecting neurones of the BF. Orexin fibres synapse on BF cholinergic neurones and orexin-A is released in the BF during waking. Local application of orexins excites BF cholinergic neurones, induces cortical release of acetylcholine and promotes wakefulness. The orexin neurones also contain and probably co-release the inhibitory neuropeptide dynorphin. We found that orexin-A and dynorphin have specific effects on different classes of BF neurones that project to the cortex. Cholinergic neurones were directly excited by orexin-A, but did not respond to dynorphin. Non-cholinergic BF neurones that project to the cortex seem to comprise at least two populations with some directly excited by orexin-A that may represent wake-active, GABAergic neurones, whereas others did not respond to orexin-A but were inhibited by dynorphin and may be sleep-active, GABAergic neurones. This evidence suggests that the BF is a key site through which orexins activate the cortex and promote behavioural arousal. In addition, orexins and dynorphin may act synergistically in the BF to promote arousal and improve cognitive performance.