Volatile (inhaled) anesthetics cause amnesia at concentrations well below those that cause loss of consciousness and immobility; however, the underlying neuronal mechanisms are unknown. Although many anesthetics increase inhibitory GABAergic synaptic transmission, this effect occurs only at high concentrations (>100 microm). Molecular targets for low concentrations of inhaled anesthetics have not been identified. Here, we report that a tonic inhibitory conductance in hippocampal pyramidal neurons generated by alpha5 subunit-containing GABA(A) receptors is highly sensitive to low concentrations of the volatile anesthetic isoflurane (ISO) (25 and 83.3 microm). The alpha5 subunit is necessary for enhancement of the tonic current by these low concentrations of isoflurane because potentiation is absent in neurons from alpha5-/- mice. Furthermore, ISO (25 microm) potentiated recombinant human alpha5beta3gamma2L GABA(A) receptors, whereas this effect was not seen with alpha1beta3gamma2L GABA(A) receptors. These studies suggest that an increased tonic inhibition in the hippocampus may contribute to amnestic properties of volatile anesthetics.