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GABAergic interneuron dysfunction has been implicated in temporal lobe epilepsy (TLE), autism, and schizophrenia. Inhibitory interneuron progenitors transplanted into the hippocampus of rodents with TLE provide varying degrees of seizure suppression. We investigated whether human embryonic stem cell (hESC)-derived interneuron progenitors (hESNPs) could differentiate, correct hippocampal-dependent spatial memory deficits, and suppress seizures in a pilocarpine-induced TLE mouse model. We found that transplanted ventralized hESNPs differentiated into mature GABAergic interneurons and became electrophysiologically active with mature firing patterns. Some mice developed hESNP-derived tumor-like NSC clusters. Mice with transplants showed significant improvement in the Morris water maze test, but transplants did not suppress seizures. The limited effects of the human GABAergic interneuron progenitor grafts may be due to cell type heterogeneity within the transplants.