The GABAA/benzodiazepine receptor has been solubilized from membrane preparations of bovine cerebral cortex and has been reconstituted, in a functionally active form, into phospholipid vesicles. In preliminary experiments, the receptor was labeled with the photoactive benzodiazepine [3H]flunitrazepam prior to solubilization. A peptide of apparent molecular weight 53,500 was specifically labeled by this method, and this was used as a marker for the receptor during the reconstitution procedures. The labeled protein was solubilized with approximately 40% efficiency by 1% beta-octyl glucoside. Reconstitution was achieved by mixing the solubilized proteins with a 4:1 mixture of soybean asolectin and bovine brain phospholipids, followed by chromatography on Sephadex G-50-80 to remove detergent. The incorporation of the GABAA receptor into membrane vesicles has been verified by sucrose gradient centrifugation in which the [3H]-flunitrazepam-labeled peptide comigrated with [14C]phosphatidylcholine used as a lipid marker. Vesicles prepared without labeled markers retained the ability to bind both [3H]flunitrazepam and the GABA analogue [3H]muscimol. Furthermore, the binding parameters were very similar to those measured using native membrane preparations. A novel fluorescence technique has been used to measure chloride transport mediated by the GABAA receptor in reconstituted vesicles. Chloride influx was rapidly stimulated in the presence of micromolar concentrations of muscimol and was blocked by preincubation of the membranes with muscimol (desensitization). Flux was also blocked by pretreatment with the competitive GABAA receptor blocker bicuculline or with the noncompetitive GABAA receptor antagonist picrotoxin.