Rapid changes in extracellular K+ concentration ([K+]o) in the mammalian central nervous system (CNS) are counteracted by simple passive diffusion as well as by cellular mechanisms of K+ clearance. Regulation of [K+]o can occur via glial or neuronal uptake of K+ ions through transporters or K+-selective ion channels. The best studied mechanism of [K+]o regulation in the brain is K+ spatial buffering, wherein the glial syncytium disperses local extracellular K+ increases by transferring K+ from sites of elevated [K+]o to those with lower [K+]o. In recent years, K+ spatial buffering has been implicated or directly demonstrated by a variety of experimental approaches, including electrophysiological and optical methods. A specialized form of spatial buffering termed K+ siphoning takes place in the vertebrate retina, where glial Müller cells express inwardly rectifying K+ channels (Kir channels) positioned in membrane domains near to the vitreous humor and blood vessels. This highly compartmentalized distribution of Kir channels in retinal glia directs K+ ions from the synaptic layers to the vitreous humor and blood vessels. Here, we review the principal mechanisms of [K+]o regulation in the CNS and recent molecular studies on the structure and function of glial Kir channels. We also discuss intriguing new data that suggest a close physical and functional relationship between Kir and water channels in glial cells.