Neurotransmission depends on the availability of transmitter and on the presence of functional, high-affinity receptors at the plasma membrane that are capable of binding ligand. The pathway, mechanism and function of endocytosis and recycling of the substance P or neurokinin 1 receptor in enteric neurons were studied using fluorescent substance P, receptor antibodies and confocal microscopy. In both the soma and neurites, substance P induced rapid, clathrin-mediated internalization of the neurokinin 1 receptor into early endosomes, which also contained the transferrin receptor. After 4–8h, there was a return in surface neurokinin 1 receptor immunoreactivity in the soma, which was not prevented by cycloheximide, and was thus independent of new protein synthesis. This return was prevented by acidotropic agents, and therefore required endosomal acidification. This suggests that the neurokinin 1 receptor recycles in the soma. In contrast, in neurites, substance P and the neurokinin 1 receptor remained in endosomes and recycling was not detected. Neurons of the myenteric plexus were heavily innervated by substance P-containing nerve fibers, and K⁺-stimulated release of endogenous substance P from cultured neurons induced internalization of the neurokinin 1-receptor. Therefore, endogenous substance P may induce endocytosis of the neurokinin 1 receptor. In the soma, endocytosis and recycling correlated with loss and recovery of functional binding sites for substance P, suggesting that this process contributes to the regulation of peptidergic neurotransmission. Thus, ligand-induced endocytosis of the neurokinin 1 receptor in myenteric neurons is associated with a loss of surface receptors and functional binding sites. Since release of endogenous substance P induces neurokinin 1 receptor internalization, and neurokinin 1 receptor neurons are innervated by substance P-containing fibers, endocytosis of neuropeptide receptors may regulate neurotransmission.