The present study deals with the functional interaction of antipsychotic drugs and NMDA receptors. We show that both the conventional antipsychotic drug haloperidol and the atypical antipsychotic drug clozapine mediate gene expression via intracellular regulation of NMDA receptors, albeit to different extents. Data obtained in primary striatal culture demonstrate that the intraneuronal signal transduction pathway activated by haloperidol, the cAMP pathway, leads to phosphorylation of the NR1 subtype of the NMDA receptor at (897)Ser. Haloperidol treatment is likewise shown to increase (897)Ser-NR1 phosphorylation in rats in vivo. Mutation of (896)Ser and (897)Ser to alanine, which prevents phosphorylation at both sites, inhibits cAMP-mediated gene expression. We conclude that antipsychotic drugs have the ability to modulate NMDA receptor function by an intraneuronal signal transduction mechanism. This facilitation of NMDA activity is necessary for antipsychotic drug-mediated gene expression and may contribute to the therapeutic benefits as well as side effects of antipsychotic drug treatment.