The substantia nigra pars reticulata (SNr), a key basal ganglia output nucleus, is modulated by dopamine (DA) believed to be released locally from midbrain DA neurons. Although DA has been proposed to regulate γ-aminobutyric acid (GABA) release from medium spiny neuron (MSN) terminals via presynaptic D1 receptors, the precise mechanisms remain unclear. Using presynaptic optical recordings of synaptic vesicle fusion, calcium influx in D1-MSN synapses together with postsynaptic patch-clamp recordings from SNr neurons, we found that DA inhibits D1-MSN GABA release in a frequency-dependent manner. Unexpectedly, this effect was independent of DA receptors and instead required 5-HT1B receptor activation. Using two-photon serotonin biosensor imaging in slices and fiber photometry in vivo, we demonstrate that DA enhances extracellular serotonin in the SNr via inhibition of serotonin reuptake. Our results suggest that serotonin mediates DAergic control of basal ganglia output and contributes to the therapeutic actions of dopaminergic medications for Parkinson's disease and psychostimulant-related disorders.