We provide definitive evidence for the mechanism of electronic detection of ammonia by monitoring in situ changes in the electrical resistance and optical spectra of films of poly(m-aminobenzenesulfonic acid)-functionalized SWNTs (SWNT-PABS). The increase of resistance during exposure to ammonia is associated with deprotonation of the PABS side chain that in turn induces electron transfer between the oligomer and the valence band of the semiconducting SWNTs. Near IR spectroscopy is used to demonstrate that the charge transfer is a weakly driven process, and this accounts for the high reversibility of the sensor. We show that the sensitivity of the chemiresistors increases as the film thickness is reduced to the percolation threshold and that the SWNT-PABS film thickness provides a simple means to enhance the electronic response.