Recent postmortem studies have demonstrated subtle alterations in the hippocampal formation (HIPP) of patients with schizophrenia (SZ). These changes include a decreased density of nonpyramidal neurons (NPs), an increase of the GABAA, but not benzodiazepine receptors and a neuroleptic-dose-related increase of GAD65-IR terminals, particularly in sectors CA3 and CA2. High resolution studies of the GABAA receptor have further suggested that a decrease of disinhibitory GABAergic activity (i.e., GABA-to-GABA) in stratum pyramidale of CA3 may coexist with reduced inhibitory modulation (i.e., GABA-to-excitatory pyramidal neuron) in the stratum oriens of this same sector. These changes could potentially involve excitotoxic damage to interneurons in CA2; but, the precise time frame for the induction of such an injury during pre- versus postnatal life cannot as yet be inferred from the available data. These findings are consistent with reports of abnormal oscillatory rhythms and increased basal metabolic activity in the HIPP of patients with SZ. The fact that patients with manic depression also show a decrease of NPs in CA2 suggests that changes in the GABA system may not be related to a susceptibility gene for SZ. Rather, these alterations could be associated with a nonspecific factor, such as stress, experienced either early in life or much later during adolescence or adulthood. Presumably, there are also changes associated in other transmitter systems that may play a more specific role in establishing the SZ phenotype.