Brain-derived neurotrophic factor (BDNF) is a potent regulator of neuronal activity, neurogenesis, and depressive-like behaviors; however, downstream effectors by which BDNF exerts these varying actions remain to be determined. Here we reveal that BDNF induces long-lasting enhancements in the efficacy of synaptic inhibition by stabilizing γ2 subunit-containing GABA A receptors (GABA A Rs) at the cell surface, leading to persistent reductions in neuronal excitability. This effect is dependent upon enhanced phosphorylation of tyrosines 365 and 367 (Y365/7) in the GABA A R γ2 subunit as revealed using mice in which these residues have been mutated to phenyalanines (Y365/7F). Heterozygotes for this mutation exhibit an antidepressant-like phenotype, as shown using behavioral-despair models of depression. In addition, heterozygous Y365/7F mice show increased levels of hippocampal neurogenesis, which has been strongly connected with antidepressant action. Both the antidepressant phenotype and the increased neurogenesis seen in these mice are insensitive to further modulation by BDNF, which produces robust antidepressant-like activity and neurogenesis in wild-type mice. Collectively, our results suggest a critical role for GABA A R γ2 subunit Y365/7 phosphorylation and function in regulating the effects of BDNF.