Hypothalamic neurons that contain the neuropeptide orexin (hypocretin) play important roles in the regulation of sleep/wake. Here we analyze the in vivo and in vitro phenotype of mice lacking the GABA(B1) gene specifically in orexin neurons (oxGKO mice) and demonstrate that GABA(B) receptors on orexin neurons are essential in stabilizing and consolidating sleep/wake states. In oxGKO brain slices, we show that the absence of GABA(B) receptors decreases the sensitivity of orexin neurons to both excitatory and inhibitory inputs because of augmented GABA(A)-mediated inhibition that increases the membrane conductance and shunts postsynaptic currents in these neurons. This increase in GABA(A)-mediated inhibitory tone is apparently the result of an orexin receptor type 1-mediated activation of local GABAergic interneurons that project back onto orexin neurons. oxGKO mice exhibit severe fragmentation of sleep/wake states during both the light and dark periods, without showing an abnormality in total sleep time or signs of cataplexy. Thus, GABA(B) receptors on orexin neurons are crucial in the appropriate control of the orexinergic tone through sleep/wake states, thereby stabilizing the state switching mechanisms.