J. Neurochem. (2011) 116, 350–362. Abstract Lateral interactions at the first retinal synapse have been initially proposed to involve GABA by transporter‐mediated release from horizontal cells, onto GABAA receptors expressed on cone photoreceptor terminals and/or bipolar cell dendrites. However, in the mammalian retina, horizontal cells do not seem to contain GABA systematically or to express membrane GABA transporters. We here report that mouse retinal horizontal cells express GAD65 and/or GAD67 mRNA, and were weakly but consistently immunostained for GAD65/67. While GABA was readily detected after intracardiac perfusion, it was lost during classical preparation for histology or electrophysiology. It could not be restored by incubation in a GABA‐containing medium, confirming the absence of membrane GABA transporters in these cells. However, GABA was synthesized de novo from glutamate or glutamine, upon addition of pyridoxal 5′‐phosphate, a cofactor of GAD65/67. Mouse horizontal cells are thus atypical GABAergic neurons, with no functional GABA uptake, but a glutamate and/or glutamine transport system allowing GABA synthesis, probably depending physiologically from glutamate released by photoreceptors. Our results suggest that the role of GABA in lateral inhibition may have been underestimated, at least in mammals, and that tissue pre‐incubation with glutamine and pyridoxal 5′‐phosphate should yield a more precise estimate of outer retinal processing.