The cAMP signaling pathway mediates synaptic plasticity and is essential for memory formation in both vertebrates and invertebrates. In the fruit fly Drosophila melanogaster, mutations in the cAMP pathway lead to impaired olfactory learning. These mutant genes are preferentially expressed in the mushroom body (MB), an anatomical structure essential for learning. While cAMP-mediated synaptic plasticity is known to be involved in facilitation at the excitatory synapses, little is known about its function in GABAergic synaptic plasticity and learning. In this study, using whole-cell patch-clamp techniques on Drosophila primary neuronal cultures, we demonstrate that focal application of an adenylate cyclase activator forskolin (FSK) suppressed inhibitory GABAergic postsynaptic currents (IPSCs). We observed a dual regulatory role of FSK on GABAergic transmission, where it increases overall excitability at GABAergic synapses, while simultaneously acting on postsynaptic GABA receptors to suppress GABAergic IPSCs. Further, we show that cAMP decreased GABAergic IPSCs in a PKA-dependent manner through a postsynaptic mechanism. PKA acts through the modulation of ionotropic GABA receptor sensitivity to the neurotransmitter GABA. This regulation of GABAergic IPSCs is altered in the cAMP pathway and short-term memory mutants dunce and rutabaga, with both showing altered GABA receptor sensitivity. Interestingly, this effect is also conserved in the MB neurons of both these mutants. Thus, our study suggests that alterations in cAMP-mediated GABAergic plasticity, particularly in the MB neurons of cAMP mutants, account for their defects in olfactory learning.