Adenosine-to-inosine (A-to-I) editing of RNA transcripts is an increasingly recognized cellular strategy to modulate the function of proteins involved in neuronal excitability. We have characterized the editing of transcripts encoding the alpha3 subunit of heteromeric GABA(A) receptors (Gabra3), in which a genomically encoded isoleucine codon (ATA) is converted to a methionine codon (ATI) in a region encoding the predicted third transmembrane domain of this subunit. Editing at this position (I/M site) was regulated in a spatiotemporal manner with approximately 90% of the Gabra3 transcripts edited in most regions of adult mouse brain, but with lower levels of editing in the hippocampus. Editing was low in whole-mouse brain at embryonic day 15 and increased during development, reaching maximal levels by postnatal day 7. GABA-evoked current in transfected cells expressing nonedited alpha3(I)beta3gamma2L GABA(A) receptors activated more rapidly and deactivated much more slowly than edited alpha3(M)beta3gamma2L receptors. Furthermore, currents from nonedited alpha3(I)beta3gamma2L receptors were strongly outwardly rectifying (corresponding to chloride ion influx), whereas currents from edited alpha3(M)beta3gamma2L receptors had a more linear current/voltage relationship. These studies suggest that increased expression of the nonedited alpha3(I) subunit during brain development, when GABA is depolarizing, may allow the robust excitatory responses that are critical for normal synapse formation. However, the strong chloride ion influx conducted by receptors containing the nonedited alpha3(I) subunit could act as a shunt to prevent excessive excitation, providing the delicate balance necessary for normal neuronal development.