A large body of evidence from in vitro studies suggests that GABA is depolarizing during early postnatal development. However, the mode of GABA action in the intact developing brain is unknown. Here we examine the in vivo effects of GABA in cells of the upper cortical plate using a combination of electrophysiological and Ca(2+)-imaging techniques. We report that at postnatal days (P) 3-4, GABA depolarizes the majority of immature neurons in the occipital cortex of anaesthetized mice. At the same time, GABA does not efficiently activate voltage-gated Ca(2+) channels and fails to induce action potential firing. Blocking GABA(A) receptors disinhibits spontaneous network activity, whereas allosteric activation of GABA(A) receptors has the opposite effect. In summary, our data provide evidence that in vivo GABA acts as a depolarizing neurotransmitter imposing an inhibitory control on network activity in the neonatal (P3-4) neocortex.