Astrocyte signals can modulate arteriolar tone, contributing to regulation of cerebral blood flow, but specific intercellular communication mechanisms are unclear. Here we used isolated cerebral arteriole myocytes, astrocytes, and brain slices to investigate whether carbon monoxide (CO) generated by the enzyme heme oxygenase (HO) acts as an astrocyte-to-myocyte gasotransmitter in the brain. Glutamate stimulated CO production by astrocytes with intact HO-2, but not those genetically deficient in HO-2. Glutamate activated transient K_Ca currents and single K_Ca channels in myocytes that were in contact with astrocytes, but did not affect K_Ca channel activity in myocytes that were alone. Pretreatment of astrocytes with chromium mesoporphyrin (CrMP), a HO inhibitor, or genetic ablation of HO-2 prevented glutamate-induced activation of myocyte transient K_Ca currents and K_Ca channels. Glutamate decreased arteriole myocyte intracellular Ca²⁺ concentration and dilated brain slice arterioles and this decrease and dilation were blocked by CrMP. Brain slice arteriole dilation to glutamate was also blocked by L-2-alpha aminoadipic acid, a selective astrocyte toxin, and paxilline, a K_Ca channel blocker. These data indicate that an astrocytic signal, notably HO-2–derived CO, is used by glutamate to stimulate arteriole myocyte K_Ca channels and dilate cerebral arterioles. Our study explains the astrocyte and HO dependence of glutamatergic functional hyperemia observed in the newborn cerebrovascular circulation in vivo.