Neocortical acetylcholine (ACH) release is known to enhance signal processing by increasing the amplitude and signal-to-noise ratio (SNR) of sensory responses. It is widely accepted that the larger sensory responses are caused by a persistent increase in the excitability of all cortical excitatory neurons. Here, contrary to this concept, we show that ACH persistently inhibits layer 4 (L4) spiny neurons, the main targets of thalamocortical inputs. Using whole-cell recordings in slices of rat primary somatosensory cortex, we demonstrate that this inhibition is specific to L4 and contrasts with the ACH-induced persistent excitation of pyramidal cells in L2/3 and L5. We find that this inhibition is induced by postsynaptic M(4)-muscarinic ACH receptors and is mediated by the opening of inwardly rectifying potassium (K(ir)) channels. Pair recordings of L4 spiny neurons show that ACH reduces synaptic release in the L4 recurrent microcircuit. We conclude that ACH has a differential layer-specific effect that results in a filtering of weak sensory inputs in the L4 recurrent excitatory microcircuit and a subsequent amplification of relevant inputs in L2/3 and L5 excitatory microcircuits. This layer-specific effect may contribute to improve cortical SNR.