Environmental stress is a major risk factor for neuropsychiatric disorders, but the fundamental mechanisms underlying this vulnerability remains unknown. A growing evidence indicates that stress-related psychopathology arises in part from the dysregulation of brain mesolimbic reward circuitry, which is primarily comprised of the ventral tegmental area (VTA) and the nucleus accumbens (NAc). Our data in rodents indicate that stress dysregulates reward processing via decreased function of anion transporter KCC2 located in VTA GABA neurons. This form of stress-induced neuroadaptation in GABAergic signaling has not been fully characterized, and we plan to investigate its impact on dopamine signaling and reward processing in rats. Given that VTA GABA neurons provide a major inhibitory input to the mesolimbic dopamine neurons, we will measure the impact of these neurons and stress-induced KCC2 downregulation on dopamine signaling. These studies will account for functionally distinct tonic and phasic modes of dopamine neuron activity, which can be differentially regulated by VTA GABA neurons. Heterogeneous populations of dopamine neurons participate in anatomically separate circuits that mediate different aspects of reward processing. To test if stress-induced KCC2 hypofunction dysregulates dopamine signaling in a circuit-specific manner, we will measure GABAergic transmission onto specific dopamine projections to the core, medial, and lateral shell of the NAc. Ultimately, we will examine the role of stress-induced KCC2 downregulation and VTA GABA neurons in different aspects of reward processing. Rats will be exposed to acute stress and we will measure reward learning and incentive motivation while manipulating KCC2 in VTA GABA neurons. Behavioral tasks will be accompanied by multi-unit electrophysiology and optogenetics to further explore the contribution of different VTA neuron types to distinct reward processes. Taken together, these studies will comprehensively examine the impact of stress on reward processing and hold the potential to improve our understanding of GABAergic regulation of complex dopamine signaling.