This paper proposes neural mechanisms of transcranial magnetic stimulation (TMS). TMS can stimulate the brain non-invasively through a brief magnetic pulse delivered by a coil placed on the scalp, interfering with specific cortical functions with a high temporal resolution. Due to these advantages, TMS has been a popular experimental tool in various neuroscience fields. However, the neural mechanisms underlying TMSinduced interference are still unknown; a theoretical basis for TMS has not been developed. This paper provides computational evidence that inhibitory interactions in a neural population, not an isolated single neuron, play a critical role in yielding the neural interference induced by TMS.