The neurobiology underlying depression in older adults is less extensively evaluated than in younger adults, despite the putative influence of aging on depression neuropathology. Studies using transcranial magnetic stimulation (TMS), a neurophysiological tool capable of probing inhibitory and excitatory cortical neurotransmission, have identified dysfunctional GABAergic inhibitory activity in younger adults with depression. However, GABAergic and glutamatergic cortical neurotransmission have not yet been studied in late-life depression (LLD). Here, we used single- and paired-pulse TMS to measure cortical inhibition and excitation in 92 LLD patients and 41 age-matched healthy controls. To differentiate the influence of age and depression, we also compared these TMS indices to those of 30 younger depressed adults and 30 age- and sex-matched younger healthy adults. LLD patients, older healthy adults, and younger depressed adults demonstrated significantly lower GABAA receptor-mediated cortical inhibition than younger healthy controls. By contrast, no significant differences in cortical inhibition were observed between older adults with and without depression. No significant differences in GABAB receptor-mediated inhibition or cortical excitation were found between the groups. Altogether, these findings suggest that reduced cortical inhibition may be associated with both advancing age and depression, which (i) supports the model of depression as a disease of accelerated aging, and (ii) prompts future investigation into diminished GABAergic neurotransmission in late-life as a biological predisposing factor to the development of depression. Given that cortical neurophysiology was similar in depressed and healthy older adults, future prospective studies need to establish the relative influence of age and depression on cortical inhibition deficits.