The capsaicin receptor (TRPV1) is a nonselective cation channel that integrates multiple painful stimuli, including capsaicin, protons, and heat. Protons facilitate the capsaicin- and heat-induced currents by decreasing thermal threshold or increasing agonist potency for TRPV1 activation (Tominaga, M., Caterina, M. J., Malmberg, A. B., Rosen, T. A., Gilbert, H., Skinner, K., Raumann, B. E., Basbaum, A. I., and Julius, D. (1998) Neuron 21, 531-543). In the presence of saturating capsaicin, rat TRPV1 (rTRPV1) reaches full activation, with no further stimulation by protons. Human TRPV1 (hTRPV1), a species ortholog with high homology to rTRPV1, is potentiated by extracellular protons and magnesium, even at saturating capsaicin. We investigated the structural basis for protons and magnesium modulation of fully capsaicin-bound human receptors. By analysis of chimeric channels between hTRPV1 and rTRPV1, we found that transmembrane domain 1-4 (TM1-4) of TRPV1 determines whether protons can further open the fully capsaicin-bound receptors. Mutational analysis identified a titratable glutamate residue (Glu-536) in the linker between TM3 and TM4 critical for further stimulation of fully liganded hTRPV1. In contrast, hTRPV1 TM5-6 is required for magnesium augmentation of capsaicin efficacy. Our results demonstrate that capsaicin efficacy of hTRPV1 correlates with the extracellular ion milieu and unravel the relevant structural basis of modulation by protons and magnesium.