Sensory perception relies on the flexible detection and interpretation of stimuli across variable contexts, conditions, and behavioral states. The basal forebrain is a hub for behavioral state regulation, supplying dense cholinergic and GABAergic projections to various brain regions involved in sensory processing. Of GABAergic neurons in the basal forebrain, parvalbumin (PV) and somatostatin (SST) subtypes serve opposing roles towards regulating behavioral states. To elucidate the role of basal forebrain circuits in sensory-guided behavior, we investigated GABAergic signaling dynamics during odor-guided decision-making in male and female mice. We used fiber photometry to record cell type-specific basal forebrain activity during an odor discrimination task and correlated temporal patterns of PV and SST neuronal activity with olfactory task performance. We found that while both PV-expressing and SST-expressing GABAergic neurons were excited during trial initiation, PV neurons were selectively suppressed by reward whereas SST neurons were excited. Notably, chemogenetic inhibition of BF SST neurons modestly altered decision bias to favor reward-seeking while optogenetic inhibition of BF PV neurons during odor presentations improved discrimination accuracy. Together, these results suggest that the bidirectional activity of GABAergic basal forebrain neuron subtypes distinctly influence perception and decision-making during olfactory guided behavior.