Designing potent and subtype-selective ligands with therapeutic value requires knowledge about how endogenous ligands interact with their binding site. 4-Amino-3-hydroxybutanoic acid (GABOB) is an endogenous ligand found in the central nervous system in mammals. It is a metabolic product of GABA, the major inhibitory neurotransmitter. Homology modeling of the GABA(C) ρ(1) receptor revealed a potential H-bond interaction between the hydroxyl group of GABOB and threonine 244 (T244) located on loop C of the ligand binding site of the ρ(1) subunit. Using site-directed mutagenesis, we examined the effect of mutating T244 on the efficacy and pharmacology of GABOB and various ligands. It was found that mutating T244 to amino acids that lacked a hydroxyl group in their side chains produced GABA insensitive receptors. Only by mutating ρ(1)T244 to serine (ρ(1)T244S) produced a GABA responsive receptor, albeit 39-fold less sensitive to GABA than ρ(1)wild-type. We also observed changes in the activities of the GABA(C) receptor partial agonists, muscimol and imidazole-4-acetic acid (I4AA). At the concentrations we tested, the partial agonists antagonized GABA-induced currents at ρ(1)T244S mutant receptors (Muscimol: ρ(1)wild-type, EC(50) = 1.4 μM; ρ(1)T244S, IC(50) = 32.8 μM. I4AA: ρ(1)wild-type, EC(50) = 8.6 μM; ρ(1)T244S, IC(50) = 21.4 μM). This indicates that T244 is predominantly involved in channel gating. R-(-)-GABOB and S-(+)-GABOB are full agonists at ρ(1)wild-type receptors. In contrast, R-(-)-GABOB was a weak partial agonist at ρ(1)T244S (1 mM activates 26% of the current produced by GABA EC(50) versus ρ(1)wild-type, EC(50) = 19 μM; I(max) 100%), and S-(+)-GABOB was a competitive antagonist at ρ(1)T244S receptors (ρ(1)wild-type, EC(50) = 45 μM versus ρ(1)T244S, IC(50) = 417.4 μM, K(B) = 204 μM). This highlights that the interaction of GABOB with T244 is enantioselective. In contrast, the potencies of a range of antagonists tested, 3-aminopropyl(methyl)phosphinic acid (3-APMPA), 3-aminopropylphosphonic acid (3-APA), S- and R-(3-amino-2-hydroxypropyl)methylphosphinic acid (S-(-)-CGP44532 and R-(+)-CGP44533), were not altered. This suggests that T244 is not critical for antagonist binding. Receptor gating is dynamic, and this study highlights the role of loop C in agonist-evoked receptor activation, coupling agonist binding to channel gating.