Effects of fetal hippocampal transplants were evaluated following a prolonged intraventricular excitotoxic lesion (1.0 mg of N-methyl-D-aspartate over two weeks infusion) in F344 rats. The septum and ipsilateral hippocampus (CA1 and dentate regions) showed extensive cell loss, decreased acquisition of spatial memory was observed and a decrease in AChE positive fiber innervation to the hippocampus was noted following the lesion. Fetal hippocampal transplants into the posterior lateral ventricle resulted in moderate graft survival and physiological analysis of graft-host interconnection in vitro demonstrated evoked field potentials. However, the transplants did not lead to significant improvement in behavior, possibly due to poor synaptic integration of the intraventricular transplants into the host hippocampus. The prolonged intraventricular NMDA lesion may be helpful to understand a mixed lesion model of both septal areas and hippocampus and also as a background lesion in which to assess the connectivity and development of various types of neural grafts.