While the synaptic mechanisms involved in the generation of in vitro network oscillations have been widely studied, little is known about the importance of voltage-gated currents during such activity. Here we study the role of the M-current ( I M) in the modulation of network oscillations in the gamma-frequency range (20–80 Hz). Kv7/KCNQ subunits, the molecular correlates of I M, are abundantly expressed in CA1 and CA3 pyramidal neurons, and I M is an important modulator of pyramidal neuron firing. Using hippocampal slices, we recorded field activity and pyramidal neuron action potential timing during kainate-induced gamma oscillations. Application of the specific I M blocker XE991 causes a significant reduction of gamma oscillation amplitude with no significant change in oscillation frequency. Concomitant CA3 pyramidal neuron recordings show a significant increase in action potential frequency during ongoing gamma oscillations after the application of XE991. This increase is associated with a significant loss of periodicity of pyramidal neuron action potentials relative to the phase of the gamma oscillations. Using dynamic clamp, we show that I M acts to improve the periodicity of action potential timing and to decrease action potential frequency. We further validate these results in a compartmental model of a pyramidal neuron. Our work suggests that I M modulates gamma oscillations by regulating the phasing of action potential firing in pyramidal neurons.