The neocortex contains two neuron types, excitatory (glutamatergic) pyramidal cells and inhibitory nonpyramidal (GABAergic) cells. GABAergic, inhibitory interneurons are morphologically distinct from excitatory pyramidal cells and account for 20-25 % of all neocortical neurons. Recent studies discovered that besides morphological features, inhibitory interneurons are molecularly and physiologically heterogenous and differ significantly in arrangement and terminations of their axonal endings. In neocortical interneurons, GABA is also co-localized with calcium-binding proteins (parvalbumin, calbindin, calretinin), with neuropeptides and nitric oxide synthase. Axons of GABAergic neurons target distinct domains of pyramidal neurons. Double-bouquet, Martinotti and neurogliaform cells (CB-IR, CR-IR) target distal dendrites of pyramidal neurons and probably regulate the vertical integration of synaptic input along the dendritic tree of pyramids. Basket cells (PV-IR) innervate soma and proximal dendrites, and Chandelier cells (PV-IR) exhibit synaptic contacts on the axon initial segment of pyramidal neurons. GABAergic neocortical interneurons are interconnected by gap junctions. Most often coupling is bidirectional and occurs between interneurons of the same type. Cortical pyramidal neurons derive from the dorsal telencephalon while the majority of interneurons derive from the ganglionic eminences of the ventral telencephalon, and tangentially migrate into cortex. Adult mammalian neurogenesis is not restricted to the hippocampus, but a small number of the new neurons is also generated in the neocortex. New cortical neurons are GABAergic and co-express calbindin and calretinin. Quantitative analysis of selected areas of the neocortex (neuropsychiatric diseases, models of epilepsy, aging) demonstrate a decrease in density of PV-IR and CB-IR neurons but not CR-IR neurons.