Approaches to differentiating pluripotent stem cells (PSCs) into neurons currently face two major challenges-(i) generated cells are immature, with limited functional properties; and (ii) cultures exhibit heterogeneous neuronal subtypes and maturation stages. Using lineage-determining transcription factors, we previously developed a single-step method to generate glutamatergic neurons from human PSCs. Here, we show that transient expression of the transcription factors Ascl1 and Dlx2 (AD) induces the generation of exclusively GABAergic neurons from human PSCs with a high degree of synaptic maturation. These AD-induced neuronal (iN) cells represent largely nonoverlapping populations of GABAergic neurons that express various subtype-specific markers. We further used AD-iN cells to establish that human collybistin, the loss of gene function of which causes severe encephalopathy, is required for inhibitory synaptic function. The generation of defined populations of functionally mature human GABAergic neurons represents an important step toward enabling the study of diseases affecting inhibitory synaptic transmission.