Despite dissemination of information regarding the harm on fetal development of smoking while pregnant, the number of pregnancies associated with nicotine exposure appears to have stagnated. Presence of nicotine during neural formulation is associated with a higher susceptibility of drug dependence, suggesting an altered development of neurons in circuits involved in saliency and motivation. The laterodorsal tegmental nucleus (LDT) plays a role in coding stimuli valence via afferents to mesolimbic nuclei. Accordingly, alterations in development of neural mechanisms in the LDT could be involved in vulnerability to drug dependency. Therefore, we examined the effect of prenatal nicotine exposure (PNE) on glutamatergic functioning of LDT neurons in mouse brain slices using whole-cell, patch clamp concurrent with fluorescence-based calcium imaging. PNE was associated with larger amplitudes of AMPA-induced currents, and greater AMPA-mediated rises in intracellular calcium. AMPA/NMDA ratios and the AMPA-current rectification index were lower and higher, respectively, consistent with changes in the functionality of AMPA receptors in the PNE, which was substantiated by a greater inhibition of evoked and spontaneous glutamatergic synaptic events by a selective inhibitor of GluA2-lacking AMPA receptors. Paired pulse ratios showed a decreased probability of glutamate release from presynaptic inputs, and fluorescent imaging indicated a decreased action potential-dependent calcium increase associated with PNE. When taken together, our data suggest that PNE alters LDT glutamatergic functioning, which could alter output to mesolimbic targets. Such an alteration could play a role in altered coding of relevancy of drug stimuli that could enhance risk for development of drug dependency.