Glycine receptors (GlyRs) are inhibitory ligand-gated ion channels. Ethanol potentiates glycine activation of the GlyR, and putative binding sites for alcohol are located in the transmembrane (TM) domains between and within subunits. To alter alcohol sensitivity of GlyR, we introduced two mutations in the GlyR ␣1 subunit, M287L (TM3) and Q266I (TM2). After expression in Xenopus laevis oocytes, both mutants showed a reduction in glycine sensitivity and glycine-induced maximal currents. Activation by taurine, another endogenous agonist, was almost abolished in the M287L GlyR. The ethanol potentiation of glycine currents was reduced in the M287L GlyR and eliminated in Q266I. Physiological levels of zinc (100 nM) potentiate glycine responses in wild-type GlyR and also enhance the ethanol potentiation of glycine responses. Although zinc potentiation of glycine responses was unchanged in both mutants, zinc enhancement of ethanol potentiation of glycine responses was absent in M287L GlyRs. The Q266I mutation decreased conductance but increased mean open time (effects not seen in M287L). Two lines of knockin mice bearing these mutations were developed. Survival of homozygous knockin mice was impaired, probably as a consequence of impaired glycinergic transmission. Glycine showed a decreased capacity for displacing strychnine binding in heterozygous knockin mice. Electrophysiology in isolated neurons of brain stem showed decreased glycine-mediated currents and decreased ethanol potentiation in homozygous knockin mice. Molecular models of the wildtype and mutant GlyRs show a smaller water-filled cavity within the TM domains of the Q266I ␣1 subunit. The behavioral characterization of these knockin mice is presented in a companion article (J Pharmacol Exp Ther 340:317-329, 2012).