Benz[e]indenes are tricyclic analogs of neuroactive steroids and can be modulators of GABA(A) receptor activity. We have examined the mechanisms of action of the benz[e]indene compound [3S-(3alpha,3aalpha,5abeta,7beta,9aalpha,9bbeta)]-dodecahydro-7-(2-hydroxyethyl)-3a-methyl-1H-benz[e]indene-3-carbonitrile (BI-2) using single-channel patch-clamp and whole-cell recordings from human embryonic kidney cells transfected with rat GABA(A) receptor alpha1, beta2, and gamma2L subunits. The data demonstrate that BI-2 is a positive modulator of GABA(A) receptor activity with a peak effect at 2 microM. The mechanism of modulation is similar but not identical to that of neuroactive steroids. Similar to steroids, BI-2 acts by prolonging the mean open time duration through an effect on the duration and prevalence of the longest open time component. However, in contrast to many steroids, BI-2 does not selectively reduce the channel closing rate. The potentiating action of BI-2 seems to be mediated through interactions with the classic neuroactive steroid binding site. Mutation to the membrane-spanning region in the alpha1 subunit Q242W and the double mutation alpha1N408A/Y411F, previously shown to abolish potentiation by neurosteroids, also diminish potentiation by BI-2. At higher concentrations (>5 microM), BI-2 inhibits receptor function by enhancing the apparent rate of desensitization. From single-channel recordings, we estimate that the entry rate into the inhibited or blocked state, k(+B), is 0.50 microM(-1) s(-1). Based on the kinetic mechanism of action, and the finding that this effect is blocked by the alpha1V256S mutation, we propose that BI-2 acts through an inhibitory site first postulated for the inhibitory neurosteroid pregnenolone sulfate.