Deletion of LIM homeodomain transcription factor-encoding Lhx6 gene in mice results in defective tangential migration of cortical interneurons and failure of differentiation of the somatostatin (Sst)- and parvalbumin (Pva)-expressing subtypes. Here, we characterize a novel hypomorphic allele of Lhx6 and demonstrate that reduced activity of this locus leads to widespread differentiation defects in Sst + interneurons, but relatively minor and localized changes in Pva + interneurons. The reduction in the number of Sst-expressing cells was not associated with a loss of interneurons, because the migration and number of Lhx6-expressing interneurons and expression of characteristic molecular markers, such as calretinin or Neuropeptide Y, were not affected in Lhx6 hypomorphic mice. Consistent with a selective deficit in the differentiation of Sst + interneurons in the CA1 subfield of the hippocampus, we observed reduced expression of metabotropic Glutamate Receptor 1 in the stratum oriens and characteristic changes in dendritic inhibition, but normal inhibitory input onto the somatic compartment of CA1 pyramidal cells. Moreover, Lhx6 hypomorphs show behavioral, histological, and electroencephalographic signs of recurrent seizure activity, starting from early adulthood. These results demonstrate that Lhx6 plays an important role in the maturation of cortical interneurons and the formation of inhibitory circuits in the mammalian cortex.