Identifying how opioids modulate signaling in relevant neurocircuitry is essential for developing new therapeutic strategies for opioid addiction. The medial habenula (MHb) is a mu-opioid receptor (MOR) hotspot that projects predominantly to the interpeduncular nucleus (IPN); however, little is known about MOR function in this pathway. Using reporter mice, we observed MOR expression in a subset of MHb and IPN neurons, where its activation induces inhibitory effects on neuronal activity. However, stimulation of MOR axons at the habenulo-peduncular (HP) synapse leads to excitatory currents that are significantly potentiated by MOR agonism. These facilitatory effects were also observed at cholinergic-defined HP synapses, depend on a monosynaptic mechanism, and are disrupted by genetic disruption of MOR in the presynaptic MHb. Thus, MORs induce a canonical inhibitory effect in somatodendritic compartments but non-canonical facilitatory effects on evoked glutamate transmission at the HP synapse, establishing a distinct mode by which MORs can modulate neuronal function.