A high-resolution elastically stretchable microelectrode array (SMEA) for interfacing with neural tissue is described. The SMEA consists of an elastomeric substrate, such as poly(dimethylsiloxane) (PDMS), elastically stretchable gold conductors, and an electrically insulating encapsulating layer in which contact holes are opened. We demonstrate the feasibility of producing contact holes with 40 μm × 40 μm openings, show why the adhesion of the encapsulation layer to the substrate is weakened during contact hole fabrication, and provide remedies. These improvements result in greatly increased fabrication yield and reproducibility. An SMEA with 28 microelectrodes was fabricated. The contact holes (100 μm × 100 μm) in the encapsulation layer are only ∼10% the size of the previous generation, allowing a larger number of microelectrodes per unit area, thus affording the capability to interface with a smaller neural population per electrode. This new SMEA is used to record spontaneous and evoked activity in organotypic hippocampal tissue slices at 0% strain before stretching, at 5% and 10% equibiaxial strain, and again at 0% strain after relaxation. Stimulus–response curves at each strain level are measured. The SMEA shows excellent biocompatibility for at least two weeks.