Focal cortical dysplasia is associated with the development of seizures in children and is present in up to 40% of intractable childhood epilepsies. Transcortical freeze lesions in newborn rats reproduce many of the anatomical and physiological characteristics of human cortical dysplasia. Rats with freeze lesions have increased seizure susceptibility and a region of hyperexcitable cortex adjacent to the lesion. Since alterations in hyperpolarization-activated nonspecific cation (HCN) channels are often associated with epilepsy, we used whole cell patch-clamp recording and voltage-sensitive dye imaging to examine alterations in HCN channels and inwardly rectifying hyperpolarization-activated currents (I(h)) in cortical dysplasia. (L5) pyramidal neurons in lesioned animals had hyperpolarized resting membrane potentials, increased input resistances and reduced voltage "sag" associated with I(h) activation. These differences became nonsignificant after application of the I(h) blocker ZD7288. Temporal excitatory postsynaptic potential (EPSP) summation and intrinsic excitability were increased in neurons near the freeze lesion. Using voltage-sensitive dye imaging of neocortical slices, we found that inhibiting I(h) with ZD7288 increased the half-width of dye signals. The anticonvulsant lamotrigine produced a significant decrease in spread of activity. The ability of lamotrigine to decrease network activity was reduced in the hyperexcitable cortex near the freeze lesion. These results suggest that I(h) serves to constrain network activity in addition to its role in regulating cellular excitability. Reduced I(h) may contribute to increased network excitability in cortical dysplasia.