Neurotransmitter-operated ion channels, such as the GABA (gamma-aminobutyric acid) receptor, are important in fast synaptic transmission between neurons. Using site-specific fluorescent labeling and simultaneous electrophysiological analysis in Xenopus laevis oocytes expressing recombinant rho1 GABA receptors, we identified agonist-mediated molecular rearrangements at three positions within and near the agonist-binding pocket that were highly correlated with receptor activation. We also show that competitive antagonists induced distinct rearrangements on their own that stabilized the receptor in a closed state. Finally, the allosteric antagonist picrotoxin induced a global conformational change that was sensed in the subunit-subunit interface of the amino (N)-terminal domain, distant from its presumed site of action within the transmembrane domains. This first detection in real time of molecular rearrangements of a ligand-activated receptor provides insights into the structural correlates of activation, antagonism and allosteric modulation.