PERHAPS the most widely recognized but least understood electrophysiological activity of the cerebral cortex is its characteristic electrical oscillations. Recently, there have been efforts to understand the mechanisms underlying high-frequency gamma oscillations (similar to 40 Hz) because they may coordinate sensory processing between populations of cortical cells(1,2), High-resolution cortical recordings show that gamma oscillations are constrained to sensory cortex(3-5) that they occur independently in auditory and somatosensory cortex(4), and that they are phase-locked between primary and secondary sensory cortex(5). As yet, the mechanism of their neurogenesis is unknown(2). Whereas cortical neurons can produce gamma oscillations without subcortical input(6-9), they may also be modulated by the thalamus(10) and basal forebrain(11). Here we report that the neural generator of gamma oscillations in auditory cortex seems to be intracortical, serving to synchronize interactions between the primary and secondary areas. The acoustic thalamus directly modulates these oscillations, which are inhibited by stimulation of the dorsal and ventral divisions of the medial geniculate nucleus (MGd and MGv) and evoked by stimulation of the adjacent posterior intralaminar nucleus (PIL).