Key points Local regulation of vascular resistance adjusts coronary blood flow to metabolic demand, although the mechanisms involved are not comprehensively understood We show that heart tissue surrounding rat coronary arteries releases diffusible factors that regulate vasoconstriction and relaxation Perivascular tissue reduces rho‐kinase‐dependent smooth muscle Ca2+ sensitivity and constriction of coronary arteries to serotonin, the thromboxane analogue U46619 and the α1‐adrenergic agonist phenylephrine Endothelium‐dependent relaxation of coronary arteries in response to cholinergic stimulation is inhibited by perivascular tissue as a result of reduced endothelial Ca2+ responses and attenuated H2S‐dependent signalling These results establish cellular mechanisms by which perivascular heart tissue can modify local vascular tone and coronary blood flow Abstract Interactions between perivascular tissue (PVT) and the vascular wall modify artery tone and contribute to local blood flow regulation. Using isometric myography, fluorescence microscopy, membrane potential recordings and phosphospecific immunoblotting, we investigated the cellular mechanisms by which PVT affects constriction and relaxation of rat coronary septal arteries. PVT inhibited vasoconstriction to thromboxane, serotonin and α1‐adrenergic stimulation but not to depolarization with elevated extracellular [K+]. When PVT was wrapped around isolated arteries or placed at the bottom of the myograph chamber, a smaller yet significant inhibition of vasoconstriction was observed. Resting membrane potential, depolarization to serotonin or thromboxane stimulation, and resting and serotonin‐stimulated vascular smooth muscle [Ca2+]‐levels were unaffected by PVT. Serotonin‐induced vasoconstriction was almost abolished by rho‐kinase inhibitor Y‐27632 and modestly reduced by protein kinase C inhibitor bisindolylmaleimide X. PVT reduced phosphorylation of myosin phosphatase targeting subunit (MYPT) at Thr850 by ∼40% in serotonin‐stimulated arteries but had no effect on MYPT‐phosphorylation in arteries depolarized with elevated extracellular [K+]. The net anti‐contractile effect of PVT was accentuated after endothelial denudation. PVT also impaired vasorelaxation and endothelial Ca2+ responses to cholinergic stimulation. Methacholine‐induced vasorelaxation was mediated by NO and H2S, and particularly the H2S‐dependent (dl‐propargylglycine‐ and XE991‐sensitive) component was attenuated by PVT. Vasorelaxation to NO‐ and H2S‐donors was maintained in arteries with PVT. In conclusion, cardiomyocyte‐rich PVT surrounding coronary arteries releases diffusible factors that reduce rho‐kinase‐dependent smooth muscle Ca2+ sensitivity and endothelial Ca2+ responses. These mechanisms inhibit agonist‐induced vasoconstriction and endothelium‐dependent vasorelaxation and suggest new signalling pathways for metabolic regulation of blood flow.