Atrial natriuretic peptide (ANP), first isolated from rat atrial cardiocytes, is a potent natriuretic, diuretic and vasorelaxant hormone when given intravenously. In keeping with increasing evidence that many bioactive peptides that were first discovered in peripheral organs, are often present in the central nervous system, ANP and its binding sites have been localized on neurons in different regions of the brain. Further, ANP binding sites have been found on primary astrocyte and glial cell lines and ligand binding results in cyclic GMP production. In this review, we shall discuss the possible role of ANP as a neuromodulator and its effects on astrocytes, the most numerous cell type in mammalian brain.