Increasing evidence indicates that the neural circuitry within glomeruli of the olfactory bulb plays a major role in affecting information flow between olfactory sensory neurons (OSNs) and output mitral cells (MCs). Glutamatergic external tufted (ET) cells, located at glomeruli, can act as intermediary cells in excitation between OSNs and MCs, whereas activation of MCs by OSNs is, in turn, suppressed by inhibitory synapses onto ET cells. In this study, we used patch-clamp recordings in rat olfactory bulb slices to examine the function of metabotropic glutamate receptors (mGluRs) in altering these glomerular signaling mechanisms. We found that activation of group II mGluRs profoundly reduced inhibition onto ET cells evoked by OSN stimulation. The mGluRs that mediated disinhibition were located on presynaptic GABAergic periglomerular cells and appeared to be activated by glutamate transients derived from dendrites in glomeruli. In terms of glomerular output, the mGluR-mediated reduction in GABA release led to a robust increase in the number of action potentials evoked by OSN stimulation in both ET cells and MCs. Importantly, however, the enhanced excitation was specific to when a glomerulus was strongly activated by OSN inputs. By being selective for strong vs. weak glomerular activation, mGluR-mediated disinhibition provides a mechanism to enhance the contrast in odor signals that activate OSN inputs into a single glomerulus at varying intensities.