Acetylcholine reflects uncertainty during hidden state inference

To act adaptively, animals must infer features of the environment that cannot be observed directly, such as which option is currently rewarding, or which context they are in. These internal estimates, known as ‘hidden states’, guide behaviour but are inherently uncertain. Theoretical models propose that efficient inference requires tracking both the most likely state and the uncertainty of that estimate. While neural representations of state identity have been described in cortical and hippocampal circuits, the origin of uncertainty signals remains unclear. Here we show that acetylcholine (ACh) reflects this uncertainty during hidden state inference. Using fibre photometry in mice performing a probabilistic two-armed bandit task, we found that ACh release in medial prefrontal cortex and ventral hippocampus tracked recent omission history and predicted whether animals would switch choice on the next trial. Blocking muscarinic receptors with scopolamine selectively impaired loss-driven switching without affecting stable performance. A hidden-state inference model in which ACh modulated how uncertainty from past experience shaped future beliefs reproduced both the physiological and behavioural effects, whereas alternative models did not. These results identify ACh as a neuromodulatory signal reflecting uncertainty during hidden-state inference, linking theoretical models of belief updating to their biological implementation in the mammalian brain.