Dimerization is a key regulatory mechanism in activation of transmembrane (TM) receptors during signal transduction. This process involves a coordinated interplay between extracellular (EX), TM, and cytoplasmic (CYTO) regions to form a specific interface required for both ligand binding and intracellular signaling to occur. While several transcriptional activator-based methods exist for investigating TM interactions in bacterial membranes, expression of TM chimera in these methods occurs in a reverse orientation, and are limited to only TM domains for proper membrane trafficking and integration. We therefore developed a new, AraC-based transcriptional reporter assay (AraTM) that expresses EX-TM-CYTO chimera in their native orientation, thereby enabling membrane trafficking to occur independent of the TM chimera used as well as permitting analysis of EX-TM-CYTO interactions in biological membranes. Using integrin α(IIb) TM-CYTO as a model, we observe a large increase in homodimerization for the constitutively active TM mutant L980A relative to wild-type in the TM-CYTO construct (A963-E1008). We also characterized the receptor for advanced glycation endproducts (RAGE), whose homooligomeric state is critical in ligand recognition, and find the specific juxtamembrane region within the CYTO (A375-P394) mediates homodimerization, and is dominant over effects observed when the extracellular C2 domain is included. Furthermore, we find good agreement between our AraTM measurements in bacterial membranes and BRET measurements made on corresponding RAGE constructs expressed in transfected HEK293 cells. Overall, the AraTM assay provides a new approach to identify specific interactions between receptor EX-TM-CYTO domains in biological membranes that are important in regulation of signal transduction.