The Y cell visual pathway implements a demodulating nonlinearity.

Neural encoding of sensory signals involves both linear and nonlinear processes. Determining which nonlinear operations are implemented by neural systems is crucial to understanding sensory processing. Here, we ask if demodulation, the process used to decode AM radio signals, describes how Y cells in the cat LGN nonlinearly encode the visual scene. In response to visual AM signals across a wide range of carrier frequencies, Y cells were found to transmit a demodulated signal, with the firing rate of single-units fluctuating at the envelope frequency but not the carrier frequency. A comparison of temporal frequency tuning properties between LGN Y cells and neurons in two primary cortical areas suggests that Y cells initiate a distinct pathway that carries a demodulated representation of the visual scene to cortex. The nonlinear signal processing carried out by the Y cell pathway simplifies the neural representation of complex visual features and allows high spatiotemporal frequencies to drive cortical responses.