The presence of melatonin in retina has been widely reported for over two decades although studies of its functional importance within the retina have only recently been emphasized. We have analyzed the biochemical characteristics of melatonin synthesis and release, focusing on rapid changes in response to light/dark conditions. Our major findings are consistent with the following conclusions: (1) melatonin synthesis is stimulated within minutes after exposure to darkness, and may reflect an increase in N-acetyl transferase activity; (2) melatonin is not stored, but rather it diffuses freely throughout the retina immediately after it is synthesized; and (3) the dark-induced increase in retinal melatonin release is a synthesis-coupled response and does not involve separate secretion mechanisms. The characteristics of melatonin synthesis and release described herein would be consistent with the proposed role of melatonin as a local paracrine effector of dark-adaptive responses in retina.