The axon initial segment of hippocampal pyramidal cells is a key subcellular compartment for action potential generation, under GABAergic control by the "chandelier" or axo-axonic cells (AACs). Although AACs are the only cellular source of GABA targeting the initial segment, their in vivo activity patterns and influence over pyramidal cell dynamics are not well understood. We achieved cell-type-specific genetic access to AACs in mice and show that AACs in the hippocampal area CA1 are synchronously activated by episodes of locomotion or whisking during rest. Bidirectional intervention experiments in head-restrained mice performing a random foraging task revealed that AACs inhibit CA1 pyramidal cells, indicating that the effect of GABA on the initial segments in the hippocampus is inhibitory in vivo. Finally, optogenetic inhibition of AACs at specific track locations induced remapping of pyramidal cell place fields. These results demonstrate brain-state-specific dynamics of a critical inhibitory controller of cortical circuits.