Treatment with ginsenosides, the major active ingredients of Panax ginseng, produces a variety of physiological effects on the central and peripheral nervous systems. Ginsenosides inhibit various types of ligand-gated ion channel but it is not clear whether they act from within or outside the cell since they are somewhat membrane-permeable. In the present study, we used the Xenopus oocyte gene expression system to determine from which side of the cell membrane the ginsenoside Rg3 (Rg3), and M4, a ginsenoside metabolite, act to regulate ligand-gated ion channel activity. Ligand-gated ion currents were measured using the two-electrode voltage clamp technique. Rg3 and M4 inhibited 5-HT3A and a3b4 nACh receptor-mediated ion currents when present outside of the cell but not when injected intracellularly. We also examined the effect of these agents on oocytes expressing the gustatory cGMP-gated ion channel, which is known to have a cGMP binding site on the intracellular side of the plasma membrane and is only activated by cytosolic cGMP. Rg3 inhibited cGMP-gated ion currents when applied extracellularly or to an outside-out patch clamp, but not when injected into the cytosol or when using an excised inside-out patch clamp. These results indicate that Rg3 and M4 regulate ligand-gated ion channel activity from the extracellular side.