Responses to the excitatory amino acid N-methyl-D-aspartate (NMDA) are markedly potentiated by nanomolar concentrations of glycine. This is due to the action of glycine at a novel strychnine-resistant binding site with an anatomical distribution identical to that for NMDA receptors, suggesting that the NMDA receptor channel complex contains at least two classes of amino-acid recognition site. Antagonists at the glycine-binding site associated with NMDA receptors act as potent non-competitive antagonists, but do not alter the mean open time or conductance, as estimated by fluctuation analysis. The mechanisms by which glycine acts on NMDA receptors are unknown, but single-channel recording experiments show an increase in opening frequency with no change in mean open time or conductance, suggesting that glycine could regulate transitions to states that are intermediate between binding of NMDA receptor agonists and ion-channel gating. It has been suggested that glycine acts as a co-agonist at the NMDA receptor, and that responses to NMDA cannot be obtained in the complete absence of glycine, but in these experiments the response to NMDA was measured at equilibrium, and it is unlikely that sufficient temporal resolution was achieved to detect rapid alterations in receptor gating. Using a fast perfusion system we find that glycine regulates desensitization at NMDA receptors; this has a major effect on the response to NMDA measured at equilibrium, as would occur with slower applications of agonist. Reduction of NMDA receptor desensitization by glycine provides an example of a novel mechanism for regulation of ion-channel activity.