The hippocampal cornu ammonis 2 (CA2) region is unique in being the only CA region receiving inputs from the hypothalamic supramammillary nucleus, of importance in modulating hippocampal theta rhythm, and is seizure resistant in temporal lobe epilepsy. CA2 has, however, been little studied, possibly because of its small size and difficulty encountered in defining its borders. To investigate the properties of CA2 interneurons, intracellular recordings with biocytin filling were made in adult hippocampal slices. Two types of basket cells were identified. A minority resembled those in CA1, with fast spiking behavior, vertically oriented dendrites, and axons confined to the region of origin. In contrast, the majority of parvalbumin-immunopositive CA2 basket and bistratified cells had long, horizontally oriented, sparsely spiny dendrites extending into all CA subfields in stratum oriens, adapting firing patterns and a pronounced "sag" in voltage responses to hyperpolarizing current, indicative of I(h). Broad CA2 basket cells innervated all three CA subfields and could thus provide CA1 and CA2 with feedforward and CA3 with feedback inhibition. In contrast, CA2 bistratified cell axons displayed striking subfield preference, innervating stratum oriens and stratum radiatum of CA2 and CA1 but stopping abruptly at the CA2/CA3 border, implying feedforward inhibition of CA2 and CA1. These unique features suggest that CA2 is more than a transitional region between CA1 and CA3. The pronounced slow sag current of many CA2 interneurons may contribute to coordination of pyramidal cell firing during theta, whereas the fast spiking behavior of a smaller population of interneurons supports more localized gamma.