Evidence suggests that plasticity of the amygdalar and hippocampal GABAergic system is critical for fear memory formation. In this study we investigated in wild-type and genetically manipulated mice the role of the activity-dependent 65-kDa isozyme of glutamic acid decarboxylase (GAD65) in the consolidation and generalization of conditioned fear. First, we demonstrate a transient reduction of GAD65 gene expression in the dorsal hippocampus (6 h post training) and in the basolateral complex of the amygdala (24 h post training) during distinct phases of fear memory consolidation. Second, we show that targeted ablation of the GAD65 gene in Gad65(-/-) mice results in a pronounced context-independent, intramodal generalization of auditory fear memory during long-term (24 h or 14 d) but not short-term (30 min) memory retrieval. The temporal specificity of both gene regulation and memory deficits in Gad65 mutant mice suggests that GAD65-mediated GABA synthesis is critical for the consolidation of stimulus-specific fear memory. This function appears to involve a modulation of neural activity patterns in the amygdalo-hippocampal pathway as indicated by a reduction in theta frequency synchronization between the amygdala and hippocampus of Gad65(-/-) mice during the expression of generalized fear memory.