The ventral pallidum (VP) lies at the intersection of basal ganglia and basal forebrain circuitry, possessing attributes of both major subcortical systems. Basal forebrain cholinergic neurons are rapidly recruited by reinforcement feedback and project to cortical and subcortical forebrain targets; in contrast, striatal cholinergic cells are local interneurons exhibiting classical 'pause-burst' responses to rewards. However, VP cholinergic neurons (VPCNs) are less characterized, and it is unclear whether basal forebrain and striatal type cholinergic neurons mix in the VP. Therefore, we performed anterograde and mono-transsynaptic retrograde labeling, in vitro acute slice recordings and bulk calcium recordings of VPCNs in mice of either sex. We found that VPCNs broadly interact with the mesocorticolimbic circuit that processes rewards and punishments, targeting the basolateral amygdala, the medial prefrontal cortex and the lateral habenula, while receiving inputs from the nucleus accumbens, hypothalamus, central amygdala, bed nucleus of stria terminalis and the ventral tegmental area. Bulk calcium recordings revealed that VPCNs responded to rewards, punishments and reward-predicting cues. Acute slice recordings showed that most VPCNs resembled the bursting type of basal forebrain cholinergic neurons (BFCNs), while a few of them were of the regular rhythmic type, which differentiated most VPCNs from striatal cholinergic interneurons. These results were confirmed by in vivo electrophysiological recordings of putative VPCNs. We conclude that VPCNs show burst firing and specialized connectivity to relay aversive and appetitive stimuli to the reinforcement circuitry, possibly implicated in mood disorders and addiction. The ventral pallidum is a special brain area, being part of both the basal ganglia system implicated in goal-directed behavior and the basal forebrain system implicated in learning and attention. It houses, among others, neurons that release the neurotransmitter acetylcholine. While these cholinergic neurons have distinct characteristics in other regions of the basal ganglia and basal forebrain, it is unclear whether those in the ventral pallidum resemble one or the other or both. Here we demonstrate that they are closer to basal forebrain cholinergic neurons both anatomically and functionally, especially resembling a burst-firing subtype thereof. In accordance, we found that they convey information about aversive and appetitive stimuli to the reinforcement circuitry, possibly implicated in mood disorders and addiction.