The hippocampus, a key structure in learning and memory processes, receives a powerful cholinergic innervation from the septum and contains nicotinic acetylcholine receptors (nAChRs). Early in postnatal development, activation of nAChRs by nicotine or endogenous acetylcholine contributes to enhance synaptic signaling. Here, the patch clamp technique was used to assess the contribution of 7- and 2-containing (7* and 2*) nAChRs to nicotine-elicited modulation of GABAergic and glutamatergic activity at the network and single cell level in the immature hippocampus of wild-type, 7-/- and 2-/- mice. We find that 7* and 2* nAChRs are sufficient to modulate nicotine-induced increase in frequency of spontaneously occurring giant depolarizing potentials (GDPs), which are generated at the network level by the synergistic action of glutamate and depolarizing GABA, and thought to play a crucial role in neuronal wiring. However, 7* but not 2* receptors were essential in nicotine-induced increase of interictal discharge frequency recorded after postnatal day 3 in the presence of bicuculline, when GABA shifted from the depolarizing to the hyperpolarizing direction. To correlate these observations with nicotine-elicited changes in synaptic transmission, we recorded spontaneous GABAergic and glutamatergic postsynaptic currents in pyramidal cells and in interneurons localized in stratum oriens, stratum pyramidale and stratum radiatum, in slices obtained from WT and knock-out animals. We find that early in postnatal life 7* and 2* nAChRs exert a fine regional modulation of GABAergic and glutamatergic transmission that underlies nicotine-elicited changes in network synchronization.