Golgi-localized γ-ear-containing ARF binding protein 3 (GGA3) is a monomeric clathrin adaptor that has been shown to regulate the trafficking of the Beta-site APP-cleaving enzyme (BACE1), which is required for production of the Alzheimer's disease (AD)-associated amyloid βpeptide. Our previous studies have shown that BACE1 is degraded via the lysosomal pathway and that depletion of GGA3 results in increased BACE1 levels and activity owing to impaired lysosomal trafficking and degradation. We further demonstrated the role of GGA3 in the regulation of BACE1 in vivo by showing that BACE1 levels are increased in the brain of GGA3 null mice. We report here that GGA3 deletion results in novelty-induced hyperactivity and decreased anxiety-like behaviors. Given the pivotal role of GABAergic transmission in the regulation of anxiety-like behaviors, we performed electrophysiological recordings in hippocampal slices and found increased phasic and decreased tonic inhibition in the dentate gyrus granule cells (DGGC). Moreover, we found that the number of inhibitory synapses is increased in the dentate gyrus of GGA3 null mice in further support of the electrophysiological data. Thus, the increased GABAergic transmission is a leading candidate mechanism underlying the reduced anxiety-like behaviors observed in GGA3 null mice. All together these findings suggest that GGA3 plays a key role in GABAergic transmission. Since BACE1 levels are elevated in the brain of GGA3 null mice, it is possible that at least some of these phenotypes are a consequence of increased processing of BACE1 substrates.