Over the past twenty years, several lines of evidence from preclinical and clinical studies has accumulated suggesting that a GABA deficit may be involved in mood disorders, particularly in depression, and that increasing GABAergic neurotransmission may exert an antidepressant effect and perhaps a mood stabilizing effect. Given that GABA has an inhibitory effect on biogenic amine neurotransmitters such as norepinephrine and serotonin and this inhibition may be involved in local circuits and interneurons, it has been suggested that the hypothesis of a GABA deficit in mood disorders does not compete with but complements the well-established hypotheses of alterations in noradrenergic and serotonergic function in mood disorders. In this paper, we systematically reviewed the results from preclinical and clinical studies of GABA function in the pathophysiology of mood disorders and in the mechanism of action of mood stabilizers, antidepressants and electroconvulsive therapy. We also discussed the unifying theory of the neurochemistry of mood disorders, which integrates the GABA hypothesis into the biogenic amine hypotheses, and indicated future directions for research.