Since the discovery of the major excitatory and inhibitory neurotransmitters and their receptors in the brain, many have deliberated over their likely structures and how these may relate to function. This was initially satisfied by the determination of the first amino acid sequences of the Cys-loop receptors that recognized acetylcholine, serotonin, GABA, and glycine, followed later by similar determinations for the glutamate receptors, comprising non-NMDA and NMDA subtypes. The last decade has seen a rapid advance resulting in the first structures of Cys-loop receptors, related bacterial and molluscan homologs, and glutamate receptors, determined down to atomic resolution. This now provides a basis for determining not just the complete structures of these important receptor classes, but also for understanding how various domains and residues interact during agonist binding, receptor activation, and channel opening, including allosteric modulation. This article reviews our current understanding of these mechanisms for the Cys-loop and glutamate receptor families.