Synaptic inhibition by GABA_A and glycine receptors, which are ligand-gated anion channels, depends on the electrochemical potential for chloride. Several potassium-chloride cotransporters can lower the intracellular chloride concentration [Cl⁻]_i, including the neuronal isoform KCC2. We show that KCC2 knockout mice died immediately after birth due to severe motor deficits that also abolished respiration. Sciatic nerve recordings revealed abnormal spontaneous electrical activity and altered spinal cord responses to peripheral electrical stimuli. In the spinal cord of wild-type animals, the KCC2 protein was found at inhibitory synapses. Patch-clamp measurements of embryonic day 18.5 spinal cord motoneurons demonstrated an excitatory GABA and glycine action in the absence, but not in the presence, of KCC2, revealing a crucial role of KCC2 for synaptic inhibition.