It is now believed that the allosteric modulation produced by ethanol in glycine receptors (GlyRs) depends on alcohol binding to discrete sites within the protein structure. Thus, the differential ethanol sensitivity of diverse GlyR isoforms and mutants was explained by the presence of specific residues in putative alcohol pockets. Here, we demonstrate that ethanol sensitivity in two ligand-gated ion receptor members, the GlyR adult ␣ 1 and embryonic ␣ 2 subunits, can be modified through selective mutations that rescued or impaired G␥ modulation. Even though both isoforms were able to physically interact with G␥, only the ␣ 1 GlyR was functionally modulated by G␥ and pharmacological ethanol concentrations. Remarkably, the simultaneous switching of two transmembrane and a single extracellular residue in ␣ 2 GlyRs was enough to generate GlyRs modulated by G␥ and low ethanol concentrations. Interestingly, although we found that these TM residues were different to those in the alcohol binding site, the extracellular residue was recently implicated in conformational changes important to generate a preopen-activated state that precedes ion channel gating. Thus, these results support the idea that the differential ethanol sensitivity of these two GlyR isoforms rests on conformational changes in transmembrane and extracellular residues within the ion channel structure rather than in differences in alcohol binding pockets. Our results describe the molecular basis for the differential ethanol sensitivity of two ligand-gated ion receptor members based on selective G␥ modulation and provide a new mechanistic framework for allosteric modulations of abuse drugs.Glycine receptors (GlyRs) 4 are members of the ligand-gated ion receptor (LGIC) superfamily, which includes the Cys-loop family composed of the inhibitory ␥-aminobutyric acid receptors and GlyRs and the excitatory nicotinic acetylcholine (nAChR) and 5-hydroxytryptamine receptors. These ionotropic receptors mediate fast synaptic transmission in the central nervous system (1, 2). Specifically, inhibitory GlyRs are critical for the control of excitability in the mammalian spinal cord and brain stem, regulating important physiological functions such as pain transmission, respiratory rhythms, motor coordination, and neuronal development (3-7).Like all Cys-loop receptors, GlyRs are heteropentameric complexes composed of ␣ and  subunits, which can assemble to form homomeric (5␣) or heteromeric (2␣3) channels. To date, molecular cloning studies have demonstrated four isoforms of the ␣ GlyRs (␣ 1-4 ) and one  isoform. Homomeric and heteromeric receptors share most of the GlyR general features, including a high percentage of identity between ␣ GlyRs (Ϸ75%). Nevertheless, biochemical, immunocytochemical, and in situ hybridization studies have shown that the expression of the subunits are developmentally and regionally regulated (3,4,8). For example, the ␣ 1 subunit expression increases after birth, whereas expression of the ␣ 2 subunit appears mainly restricted to early...