Glutamate decarboxylase (GAD) catalyzes the production of gamma-aminobutyric acid (GABA), a major inhibitory neurotransmitter. The mammalian brain contains two forms of GAD, with Mrs of 67,000 and 65,000 (GAD67 and GAD65). Using a new antiserum specific for GAD67 and a monoclonal antibody specific for GAD65, we show that the two forms of GAD differ in their intraneuronal distributions: GAD67 is widely distributed throughout the neuron, whereas GAD65 lies primarily in axon terminals. In brain extracts, almost all GAD67 is in an active holoenzyme form, saturated with its cofactor, pyridoxal phosphate. In contrast, only about half of GAD65 (which is found in synaptic terminals) exists as active holoenzyme. We suggest that the relative levels of apo-GAD65 and holo-GAD65 in synaptic terminals may couple GABA production to neuronal activity.