Potassium channels of the Kv7 family that mediate the non-inactivating M current regulate the excitability of many types of neurons in the central nervous system, including some in the hippocampus. We report here that individual interneurons from newborn rat hippocampi in long-term culture strongly express messenger RNA specific for Kv7.2 and Kv7.3 and, to a lesser extent, Kv7.5 channel subunits but not for the Kv7.4 subunit. An M-like current was electrophysiologically identified in two subpopulations of interneurons distinct in their spiking behaviour (regular or fast spiking). The M-channel enhancer retigabine reduced interneuronal excitability by constraining the number of action potentials generated during imposed depolarisations; this effect was inhibited by specific the M-channel blocking drugs. In paired synaptically connected interneuron-target cell recordings, anatomically localised applications of retigabine indicated that M channels were present in both the interneuron soma and its GABA-ergic inhibitory axon. We conclude that M-channel subunits and functional M channels are broadly expressed in hippocampal interneurons and their axons and are potentially capable of strongly regulating their firing properties.