GABAB receptor (GABABR) activation is known to alleviate pain by reducing neuronal excitability, primarily through inhibition of high voltage-activated (HVA) calcium (CaV2.2) channels and potentiating G protein-coupled inwardly rectifying potassium (GIRK) channels. Although the analgesic properties of small molecules and peptides have been primarily tested on isolated murine dorsal root ganglion (DRG) neurons, emerging strategies to develop, study, and characterise human pluripotent stem cell (hPSC)-derived sensory neurons present a promising alternative. In this study, hPSCs were efficiently differentiated into peripheral DRG-induced sensory neurons (iSNs) using a combined chemical and transcription factor-driven approach via a neural crest cell intermediate. Molecular characterisation and transcriptomic analysis confirmed the expression of key DRG markers such as BRN3A, ISLET1, and PRPH, in addition to GABABR and ion channels including CaV2.2 and GIRK1 in iSNs. Functional characterisation of GABABR was conducted using whole-cell patch clamp electrophysiology, assessing neuronal excitability under current-clamp conditions in the absence and presence of GABABR agonists baclofen and α-conotoxin Vc1.1. Both baclofen (100 μM) and Vc1.1 (1 μM) significantly reduced membrane excitability by hyperpolarising the resting membrane potential and increasing the rheobase for action potential firing. In voltage-clamp mode, baclofen and Vc1.1 inhibited HVA Ca2+ channel currents, which were attenuated by the selective GABABR antagonist CGP 55845. However, modulation of GIRK channels by GABABRs was not observed in the presence of baclofen or Vc1.1, suggesting that functional GIRK1/2 channels were not coupled to GABABRs in hPSC-derived iSNs. This study is the first to report GABABR modulation of membrane excitability in iSNs by baclofen and Vc1.1, highlighting their potential as a future model for studying analgesic compounds.