Clinical and experimental data suggest that fronto-cortical GABAergic deficits contribute to the pathophysiology of major depressive disorder (MDD). To further test this hypothesis, we used a well characterized rat model for depression and examined the effect of stress on GABAergic neuron numbers and GABA-mediated synaptic transmission in the medial prefrontal cortex (mPFC) of rats. Adult male Wistar rats were subjected to 9-weeks of chronic mild stress (CMS) and based on their hedonic-anhedonic behavior they were behaviorally phenotyped as being stress-susceptible (anhedonic) or stress-resilient. Post mortem quantitative histopathology was used to examine the effect of stress on parvalbumin (PV)-, calretinin- (CR), calbindin- (CB), cholecystokinin- (CCK), somatostatin-(SST) and neuropeptide Y-positive (NPY+) GABAergic neuron numbers in all cortical subareas of the mPFC (anterior cingulate (Cg1), prelimbic (PrL) and infralimbic (IL) cortexes). In vitro, whole-cell patch-clamp recordings from layer II–III pyramidal neurons of the ventral mPFC was used to examine GABAergic neurotransmission. The cognitive performance of the animals was assessed in a hippocampal-prefrontal-cortical circuit dependent learning task. Stress exposure reduced the number of CCK-, CR- and PV-positive GABAergic neurons in the mPFC, most prominently in the IL cortex. Interestingly, in the stress-resilient animals, we found higher number of neuropeptide Y-positive neurons in the entire mPFC. The electrophysiological analysis revealed reduced frequencies of spontaneous and miniature IPSCs in the anhedonic rats and decreased release probability of perisomatic-targeting GABAergic synapses and alterations in GABAB receptor mediated signaling. In turn, pyramidal neurons showed higher excitability. Anhedonic rats were also significantly impaired in the object-place paired-associate learning task. These data demonstrate that long-term stress results in functional and structural deficits of prefrontal GABAergic networks. Our findings support the concept that fronto-limbic GABAergic dysfunctions may contribute to emotional and cognitive symptoms of MDD.