In antigen-challenged guinea pigs, airway hyperreactivity is due to recruitment of eosinophils to the airway nerves and dysfunction of M₂ muscarinic receptors. M₂ receptor dysfunction is caused by eosinophil major basic protein, which is an allosteric antagonist at the receptor. Because glucocorticoids inhibit airway hyperreactivity in humans and in animal models of asthma, we tested whether dexamethasone treatment (6 μ g · kg^{− 1} · d^{− 1} for 3 d, intraperitoneal) before antigen challenge prevents M₂ receptor dysfunction and airway hyperreactivity. Guinea pigs were sensitized to ovalbumin via intraperitoneal injections, and were challenged with ovalbumin via inhalation. Twenty-four hours later, hyperreactivity and M₂ receptor function were tested. Antigen-challenged animals were hyperreactive to vagal stimulation, and demonstrated loss of M₂ receptor function. Dexamethasone pretreatment prevented hyperreactivity and M₂ receptor dysfunction in antigen-challenged guinea pigs. Antigen challenge resulted in recruitment of eosinophils to the airways and to the airway nerves. Dexamethasone prevented recruitment of eosinophils to the airway nerves but did not affect total eosinophil influx into the airways. These results demonstrate that dexamethasone prevents antigen-induced hyperreactivity by protecting neuronal M₂ muscarinic receptors from antagonism by eosinophil major basic protein, and this protective mechanism appears to be by specifically inhibiting eosinophil recruitment to the airway nerves.