Inhibitory nerve cell deficiencies have been implicated in many neurological disorders including epilepsy. The decreased inhibition and/or increased excitation lead to hyper-excitability and brain imbalance. We are pursuing a strategy to re-balance the brain by injecting inhibitory nerve precursor cells. Most inhibitory nerve cells come from the medial ganglionic eminence (MGE) during fetal development. We have previously documented that mouse MGE transplants reduce seizures in animal models of epilepsy and ameliorate motor symptoms in a rat model of Parkinson’s disease. This project aims to develop human MGE cells from human embryonic stem (ES) cells and to investigate their function in animal models of human disease. In the past year, we have successfully developed a robust and reproducible method to generate human ES cell-derived MGE cells and have performed extensive gene expression and functional analyses. The gene expression profiles of these ES-derived MGE cells resemble those of mouse and human fetal MGE. They appropriately mature into inhibitory nerve cells in culture and following injection into rodent brain. Also, the ES-derived inhibitory cells exhibit active electrical properties and establish connections (synapses) with other nerve cells in culture and in the rodent brain. Thus, we have succeeded in deriving inhibitory human MGE cells from human ES cells and are now transplanting these cells into animal models of disease.