Psilocybin is a hallucinogenic compound that is showing promise in the ability to treat neurological conditions such as depression and post-traumatic stress disorder. There have been several investigations into the neural correlates of psilocybin administration using non-invasive methods, however, there has yet to be an invasive study of the mechanism of action in awake rodents. Using multi-unit extracellular recordings, we recorded local field potential and spiking activity from populations of neurons in the anterior cingulate cortex of awake mice during the administration of psilocybin (2 mg/kg). The power of low frequency bands in the local field potential was found to significantly decrease in response to psilocybin administration, whilst gamma band activity trended towards an increase. The population firing rate was found to increase overall, with just under half of individual neurons showing a significant increase. Psilocybin significantly decreased the level of phase modulation of cells with each neural frequency band except high-gamma oscillations, consistent with a desynchronization of cortical populations. Furthermore, bursting behavior was altered in a subset of cells, with both positive and negative changes in the rate of bursting. Neurons that increased their burst firing following psilocybin administration were highly likely to transition from a phase-modulated to a phase unmodulated state. Taken together, psilocybin reduces low frequency oscillatory power, increases overall firing rates and desynchronizes local neural activity. These findings are consistent with dissolution of the default mode network under psilocybin, and may be indicative of disruption of top-down processing in the acute psychedelic state.