Objective: As a result of combined biophysical and molecular biological studies, important insights into the structure and function of gamma-aminobutyric acid (GABA) receptors have been achieved. These insights have helped to define the role of GABA receptors in synaptic inhibition and the ion channel mechanisms by which different neuropsychiatric drugs work. The authors' goal is to describe the actions of GABA as a neurotransmitter and discuss the modulation of receptor function by different drugs. Data collection: The authors focus on more recent studies of the structure and physiology of the receptor-ion channel complex and the relevance of these studies to psychiatry. Findings: The CNS effects of benzodiazepines, barbiturates, and alcohol have been linked to the GABA-chloride channel receptor complex. Multible subunits of this complex have been cloned, sequenced, and expressed in heterologous systems. The results of cloning studies, coupled with membrane biophysics, have provided important insights into the structure and function of GABA receptors and their modulation by psychopharmacological agents. Conclusions: Future understanding of disease states, drug effects, and therapeutic successes and failures may be expressed in terms of differences in the structure and function of specific receptors and their associated ion channels. Furthermore, the ability to describe the molecular function of receptor subtypes offers the ability to tailor drug specificity by developing agents directed against a given receptor subtype. The current GABA studies also have important implications for the understanding of how neurotransmitter systems may be involved in illness.