Brain's electrical activity correlates strongly to changes in cerebral blood flow (CBF) and the cerebral metabolic rate of oxygen (CMRO(2)). Subthreshold synaptic processes correlate better than the spike rates of principal neurons to CBF, CMRO(2) and positive BOLD signals. Stimulation-induced rises in CMRO(2) are controlled by the ATP turnover, which depends on the energy used to fuel the Na,K-ATPase to reestablish ionic gradients, while stimulation-induced CBF responses to a large extent are controlled by mechanisms that depend on Ca(2+) rises in neurons and astrocytes. This dichotomy of metabolic and vascular control explains the gap between the stimulation-induced rises in CMRO(2) and CBF, and in turn the BOLD signal. Activity-dependent rises in CBF and CMRO(2) vary within and between brain regions due to differences in ATP turnover and Ca(2+)-dependent mechanisms. Nerve cells produce and release vasodilators that evoke positive BOLD signals, while the mechanisms that control negative BOLD signals by activity-dependent vasoconstriction are less well understood. Activation of both excitatory and inhibitory neurons produces rises in CBF and positive BOLD signals, while negative BOLD signals under most conditions correlate to excitation of inhibitory interneurons, but there are important exceptions to that rule as described in this paper. Thus, variations in the balance between synaptic excitation and inhibition contribute dynamically to the control of metabolic and hemodynamic responses, and in turn the amplitude and polarity of the BOLD signal. Therefore, it is not possible based on a negative or positive BOLD signal alone to decide whether the underlying activity goes on in principal or inhibitory neurons.