gamma-Aminobutyric acid (GABA) has an important role in the mechanism of epilepsy. Cell grafts from different sources have been performed to modulate local circuits or increase GABAergic inhibition in animal models of epilepsy. Among the different transplanted cell types, the medial ganglionic eminence (MGE)-derived cells present the best properties to be used in cell-based therapy. In this work we review previous experiences with these cells. In addition, we present new evidence showing their ability to modulate the levels of inhibition in the host brain of mice with alterations in the GABAergic system, caused by the specific ablation of hippocampal interneurons. Grafted GFP(+) MGE-derived cells occupied the area of ablation and differentiated into mature NK-1-, SOM-, PV-, CR-, and NPY-expressing interneurons. Inhibitory postsynaptic current (IPSC) frequency and amplitude on CA1 pyramidal cells of the ablated hippocampus significantly increased after transplantation, reaching levels similar to controls. Our data strongly suggest the suitability of MGE-derived cells for the treatment of neurologic conditions for which an increase or modulation of synaptic inhibition is required.