The sense of smell is highly evolved in mammals, allowing discrimination between a vast number of odorants, with detection thresholds as low as 10(-17) M (ref. 1). Although several features of mammalian olfactory transduction have been revealed by biochemical and molecular biological studies, the odorant-induced membrane current has remained elusive. In amphibians this current is mediated by cyclic-nucleotide-gated channels, which depolarize the cell by Na+ and Ca+ influx and consequent Cl- efflux through Ca(2+)-dependent Cl- channels. The Cl- current may be absent in mammals, however, because its proposed role is linked to the aquatic habitat of amphibians. Here we show that the transduction current in rat olfactory receptor cells is initiated by cyclic-nucleotide-gated channels. The Cl- current is also present and endows the transduction current with a steep sigmoidal dependence on cyclic AMP concentration in both rat and in an amphibian, indicating a new function for the Cl- channel: nonlinear amplification of the transduction signal, whereby suprathreshold responses are boosted relative to basal transduction noise.