Abstract Changes in cortical neural activity are coupled to changes in local arterial diameter and blood flow. However, the neuronal types and the signaling mechanisms that control the basal diameter of cerebral arteries or their evoked dilations are not well understood. Using chronic two-photon microscopy, electrophysiology, chemogenetics, and pharmacology in awake, head-fixed mice, we dissected the cellular mechanisms controlling the basal diameter and evoked dilation in cortical arteries. We found that modulation of overall neural activity up or down caused corresponding increases or decreases in basal arterial diameter. Surprisingly, modulation of pyramidal neuron activity had minimal effects on basal or evoked arterial dilation. Instead, the neurally-mediated component of arterial dilation was largely regulated through nitric oxide released by neuronal nitric oxide synthase (nNOS)-expressing neurons, whose activity was not reflected in electrophysiological measures of population activity. Our results show that cortical hemodynamic signals are not controlled by the average activity of the neural population, but rather the activity of a small ‘oligarchy’ of neurons.