The nicotinic acetylcholine receptor (nAChR) belongs to a superfamily of pentameric ligand-gated ion channels involved in many physiologic and pathologic processes. Among nAChRs, receptors comprising the a7 subunit are unique because of their high Ca 21 permeability and fast desensitization. nAChR agonists elicit a transient ion flux response that is further sustained by the release of calcium from intracellular sources. Owing to the dual ionotropic/metabotropic nature of a7 receptors, signaling pathways are activated. The a7 subunit is highly expressed in the nervous system, mostly in regions implicated in cognition and memory and has therefore attracted attention as a novel drug target. Additionally, its dysfunction is associated with several neuropsychiatric and neurologic disorders, such as schizophrenia and Alzheimer's disease. a7 is also expressed in non-neuronal cells, particularly immune cells, where it plays a role in immunity, inflammation, and neuroprotection. Thus, a7 potentiation has emerged as a therapeutic strategy for several neurologic and inflammatory disorders. With unique activation properties, the receptor is a sensitive drug target carrying different potential binding sites for chemical modulators, particularly agonists and positive allosteric modulators. Although macroscopic and singlechannel recordings have provided significant information about the underlying molecular mechanisms and binding sites of modulatory compounds, we know just the tip of the iceberg. Further concerted efforts are necessary to effectively exploit a7 as a drug target for each pathologic situation. In this article, we focus mainly on the molecular basis of activation and drug modulation of a7, key pillars for rational drug design.