BACKGROUND: Gene transfer of glutamic acid decarboxylase (GAD) and other methods that modulate production of GABA in the subthalamic nucleus improve basal ganglia function in parkinsonism in animal models. We aimed to assess the effect of bilateral delivery of AAV2-GAD in the subthalamic nucleus compared with sham surgery in patients with advanced Parkinson's disease. METHODS: Patients aged 30-75 years who had progressive levodopa-responsive Parkinson's disease and an overnight off-medication unified Parkinson's disease rating scale (UPDRS) motor score of 25 or more were enrolled into this double-blind, phase 2, randomised controlled trial, which took place at seven centres in the USA between Nov 17, 2008, and May 11, 2010. Infusion failure or catheter tip location beyond a predefined target zone led to exclusion of patients before unmasking for the efficacy analysis. The primary outcome measure was the 6-month change from baseline in double-blind assessment of off-medication UPDRS motor scores. This trial is registered with ClinicalTrials.gov, NCT00643890. FINDINGS: Of 66 patients assessed for eligibility, 23 were randomly assigned to sham surgery and 22 to AAV2-GAD infusions; of those, 21 and 16, respectively, were analysed. At the 6-month endpoint, UPDRS score for the AAV2-GAD group decreased by 8·1 points (SD 1·7, 23·1%; p<0·0001) and by 4·7 points in the sham group (1·5, 12·7%; p=0·003). The AAV2-GAD group showed a significantly greater improvement from baseline in UPDRS scores compared with the sham group over the 6-month course of the study (RMANOVA, p=0·04). One serious adverse event occurred within 6 months of surgery; this case of bowel obstruction occurred in the AAV2-GAD group, was not attributed to treatment or the surgical procedure, and fully resolved. Other adverse events were mild or moderate, likely related to surgery and resolved; the most common were headache (seven patients in the AAV2-GAD group vs two in the sham group) and nausea (six vs two). INTERPRETATION: The efficacy and safety of bilateral infusion of AAV2-GAD in the subthalamic nucleus supports its further development for Parkinson's disease and shows the promise for gene therapy for neurological disorders. FUNDING: Neurologix.