Sleep is a highly regulated homeostatic process that is disrupted in an estimated 50-70 million Americans. Regulation of sleep depends upon coordinated signaling of multiple neurotransmitter systems. In particular, inhibitory gamma-aminobutyric acid (GABA) signaling is required to suppress wake-active brain regions in order to initiate and maintain sleep states. GABA type A receptors (GABAARs) are ionotropic receptors with subunit compositions uniquely enriched on subcellular domains of target cells. α2 subunit-containing GABAARs are the primary target of GABA released onto the axon initial segment (AIS), a site critical for phasing the oscillatory activity of cortical cells. α2-containing GABAARs have previously been implicated in the initiation and maintenance of sleep. To determine the contribution of GABAergic singling at the AIS to regulation of sleep, we used behavioral and electroencephalographic measures to assess sleep in a mouse featuring a loss of inhibitory synapses onto the AIS (Gabra2-1). Reduced GABAergic input to the AIS results in a persistent increase in the delta frequency range in Gabra2-1 mice, suggesting an alteration in sleep regulation. Analysis of long term recordings demonstrate that Gabra2-1 homozygous mice spend less time asleep during subjective night, and also have reduced vigilance state transitions. Gabra2-1 homozygous mice show a loss of free running rhythm when housed in constant darkness, and fail to homeostatically respond to 24 hours of sleep deprivation. These studies demonstrate a role for α2 containing GABAARs in sleep initiation, transitions, and the response to sleep challenges, providing critical information for the refinement of sleep therapies.