Novelty triggers an increase in orienting behavior that is critical to evaluate the potential salience of unknown events. As novelty becomes familiar upon repeated encounters, this increase in response rapidly habituates as a form of behavioral adaptation underlying goal-directed behaviors. Many neurodevelopmental, psychiatric and neurodegenerative disorders are associated with abnormal responses to novelty and/or familiarity, although the neuronal circuits and cellular/molecular mechanisms underlying these natural behaviors in the healthy brain are largely unknown, as is the maladaptive processes that occur to induce impairment of novelty signaling in diseased brains. In rodents, the development of cutting-edge tools that allow for measurements of real time activity dynamics in selectively identified neuronal ensembles by gene expression signatures is beginning to provide advances in understanding the neural bases of the novelty response. Accumulating evidence indicate that midbrain circuits, the majority of which linked to dopamine transmission, promote exploratory assessments and guide approach/avoidance behaviors to different types of novelty via specific projection sites. The present review article focuses on midbrain circuit analysis relevant to novelty processing and habituation with familiarity.