Brain damage due to an episode of hypoxia remains a major problem in infants causing deficit in motor and sensory function. Hypoxia leads to neuronal functional failure, cerebral palsy and neuro-developmental delay with characteristic biochemical and molecular alterations resulting in permanent or transitory neurological sequelae or even death. During neonatal hypoxia, traditional resuscitation practices include the routine administration of 100% oxygen, epinephrine and glucose. In the present study, we assessed the changes in the cholinergic system by measuring the acetylcholinesterase (AChE) activity and the behavioral responses shown by hypoxia induced neonatal rats and hypoxic rats supplemented with glucose, oxygen and epinephrine using elevated plus-maze and open-field test. The acetylcholine esterase enzyme activity showed a significant decrease in cerebral cortex, whereas it increased significantly in the muscle of experimental rats when compared to control. Hypoxic rats supplemented with glucose, glucose and oxygen showed a reversal to the control status. Behavioral studies were carried out in experimental rats with elevated plus-maze test and open-field test. Hypolocomotion and anxiogenic behavioral responses were observed in all experimental rats when compared to control, hypoxic rats supplemented with glucose, glucose and oxygen. Thus, our results suggest that brain damage due to hypoxia, oxygen and epinephrine supplementation in the neonatal rats cause acetylcholine-neuromuscular-defect leading to hypolocomotion and anxiogenic behavioral response. Glucose and glucose with oxygen supplementation to hypoxic neonates protect the brain damage for a better functional status in the later life. (Contains 6 tables.)