Tonic inhibition mediated by extrasynaptic GABAA receptors (GABAARs) is an important regulator of neuronal excitability. Phosphorylation by protein kinase C (PKC) provides a key mode of regulation for synaptic GABAARs underlying phasic inhibition; however, less attention has been focused on the plasticity of tonic inhibition and whether this can also be modulated by receptor phosphorylation. To address this issue, we used whole-cell patch clamp recording in acute murine brain slices at both room and physiological temperatures to examine the effects of PKC-mediated phosphorylation on tonic inhibition. Recordings from dentate gyrus granule cells in the hippocampus and dorsal lateral geniculate relay neurons in the thalamus demonstrated that PKC activation caused downregulation of tonic GABAAR-mediated inhibition. Conversely, inhibition of PKC resulted in an increase in tonic GABAAR activity. These findings were corroborated by experiments on human embryonic kidney 293 cells expressing recombinant α4β2δ GABAARs, which represent a key extrasynaptic GABAAR isoform in the hippocampus and thalamus. Using bath application of low GABA concentrations to mimic activation by ambient neurotransmitter, we demonstrated a similar inhibition of receptor function following PKC activation at physiological temperature. Live cell imaging revealed that this was correlated with a loss of cell surface GABAARs. The inhibitory effects of PKC activation on α4β2δ GABAAR activity appeared to be mediated by direct phosphorylation at a previously identified site on the β2 subunit, serine 410. These results indicate that PKC-mediated phosphorylation can be an important physiological regulator of tonic GABAAR-mediated inhibition.