It has been well documented that diabetes mellitus is associated with cardiovascular autonomic neuropathy including dysfunction of arterial baroreflex. The mechanisms underlying diabetes-induced baroreflex dysfunction remain poorly understood. Here we investigated the function and expression of transient receptor potential vanilloid 1 (TRPV1) in aortic baroreceptor (AB) neurons isolated from streptozotocin-induced diabetic rats between 4 and 8 weeks after onset of diabetes. AB neurons in nodose ganglion were retrograde-labeled by a transported fluorescent dye, Dil. Using the whole-cell patch clamp, we found that the inward current activated by the application of capsaicin (1 μM) was significantly smaller in AB neurons from diabetic rats compared with controls. The mean peak current density of capsaicin-induced currents was 145.7 ± 24.7 pA/pF (n = 16) in diabetic neurons and 269.3 ± 31.8 pA/pF (n =15) in controls, respectively. The duration of inward current was decreased 51% in diabetic rats compared with the control group. These evoked currents were completely blocked by the capsaicin antagonist capsazepine. In addition, capsaicin-induced desensitization of TRPV1 was up-regulated, whereas TRPV1 re-sensitization was down-regulated in AB neurons from diabetic rats. Immunofluorescence staining studies demonstrated that the percentage of TRPV1-positive neurons was 50.2 ± 5.0% in control rats and 38.2 ± 1.9% in diabetic rats, respectively. This reduction in TRPV1-positive neurons in AB neurons in diabetic rats was significant (n = 11, P < 0.01). In addition, the reductions in TRPV1 currents and positive neurons s in diabetic rats were normalized by pre-treatment with anti-BDNF antibody or K252a, a TrkB tyrosine kinase inhibitor. Furthermore, incubation with BDNF caused a large reduction in TRPV1 currents in AB neurons from control rats, and the number of AB neurons with BDNF immunoreactivity was greater in diabetic than control rats. These results suggest that reduced expression and function of TRPV1 are involved in the attenuation of baroreceptor neuron excitability, and increased BDNF activity in these neurons likely contributes to the reduction in TRPV1 function through TrkB receptor stimulation in diabetic neuropathy.