Midbrain dopamine (DA) neurons are found in two nuclei, the substantia nigra pars compacta (SNc) and ventral tegmental area (VTA). The SNc dopaminergic projections to the dorsal striatum are involved in voluntary movement and habit learning, while the VTA projections to the ventral striatum contribute to reward and motivation. Nicotine induces profound DA release from VTA dopamine neurons, but substantially less from the SNc. Nicotinic acetylcholine receptor (nAChR) expression differs between these nuclei, but it is unknown whether there are differences in nAChR expression on the afferent projections to these nuclei. Here we have compared the nicotinic modulation of excitatory and inhibitory synaptic inputs to VTA and SNc dopamine neurons. While nicotine enhances both the excitatory and inhibitory drive to SNc DA cells with response magnitudes similar to those seen in the VTA, the prevalence of these responses in SNc is much lower. We also found that a mixture of nAChR subtypes underlies the synaptic modulation in SNc, further distinguishing this nucleus from the VTA, where 7 nAChRs enhance glutamate inputs and non-7 receptors enhance GABA inputs. Finally, we compared the nicotine sensitivity of DA neurons in these two nuclei and found larger response magnitudes in VTA relative to SNc. Thus, the observed differences in nicotine-induced DA release from VTA and SNc are likely due to differences in nAChR expression on the afferent inputs as well as on the DA neurons themselves. This may explain why nicotine has a greater effect on behaviors associated with the VTA than the SNc.