The superficial layers of the entorhinal cortex receive sensory and associational cortical inputs and provide the hippocampus with the majority of its cortical sensory input. The parasubiculum, which receives input from multiple hippocampal subfields, sends its single major output projection to layer II of the entorhinal cortex, suggesting that it may modulate processing of synaptic inputs to the entorhinal cortex. Indeed, stimulation of the parasubiculum can enhance entorhinal responses to synaptic input from the piriform cortex in vivo. Theta EEG activity contributes to spatial and mnemonic processes in this region, and the current study assessed how stimulation of the parasubiculum with either single pulses or short, five-pulse, theta-frequency trains may modulate synaptic responses in layer II entorhinal stellate neurons evoked by stimulation of layer I afferents in vitro. Parasubicular stimulation pulses or trains suppressed responses to layer I stimulation at intervals of 5 ms, and parasubicular stimulation trains facilitated layer I responses at a train-pulse interval of 25 ms. This suggests that firing of parasubicular neurons during theta activity may heterosynaptically enhance incoming sensory inputs to the entorhinal cortex. Bath application of the hyperpolarization-activated cation current (Ih) blocker ZD7288 enhanced the facilitation effect, suggesting that cholinergic inhibition of Ih may contribute. In addition, repetitive pairing of parasubicular trains and layer I stimulation induced a lasting depression of entorhinal responses to layer I stimulation. These findings provide evidence that theta activity in the parasubiculum may promote heterosynaptic modulation effects that may alter sensory processing in the entorhinal cortex.