Uptake of K+ released by axons during action potential propagation is a major function of astrocytes. Here, we demonstrate the importance of glial inward rectifying potassium channels (Kir) in regulating extracellular K+ ([K+]o) and axonal electrical activity in CNS white matter of the mouse optic nerve. Increasing optic nerve stimulation frequency from 1 Hz to 10–35 Hz for 120 s resulted in a rise in [K+]o and consequent decay in the compound action potential (CAP), a measure of reduced axonal activity. On cessation of high frequency stimulation, rapid K+ clearance resulted in a poststimulus [K+]o undershoot, followed by a slow recovery of [K+]o and the CAP, which were more protracted with increasing stimulation frequency. Blockade of Kir (100 μM BaCl2) slowed poststimulus recovery of [K+]o and the CAP at all stimulation frequencies, indicating a primary function of glial Kir was redistributing K+ to the extracellular space to offset active removal by Na+-K+ pumps. At higher levels of axonal activity, Kir blockade also increased [K+]o accumulation, exacerbating the decline in the CAP and impeding its subsequent recovery. In the Kir4.1−/− mouse, astrocytes displayed a marked reduction of inward currents and were severely depolarized, resulting in retarded [K+]o regulation and reduced CAP. The results demonstrate the importance of glial Kir in K+ spatial buffering and sustaining axonal activity in the optic nerve. Glial Kir have increasing importance in K+ clearance at higher levels of axonal activity, helping to maintain the physiological [K+]o ceiling and ensure the fidelity of signaling between the retina and brain.