By defining functional defects in a congenital myasthenic syndrome (CMS), we show that two mutant residues, located in a binding site region of the acetylcholine receptor (AChR) epsilon subunit, exert opposite effects on ACh binding and suppress channel gating. Single channel kinetic analysis reveals that the first mutation, εN182Y, increases ACh affinity for receptors in the resting closed state, which promotes sequential occupancy of the binding sites and discloses rate constants for ACh occupancy of the nonmutant αδ site. Studies of the analogous mutation in the δ subunit, δN187Y, disclose rate constants for ACh occupancy of the nonmutant αε site. The second CMS mutation, εD175N, reduces ACh affinity for receptors in the resting closed state; occupancy of the mutant site still promotes gating because a large difference in affinity is maintained between closed and open states. εD175N impairs overall gating, however, through an effect independent of ACh occupancy. When mapped on a structural model of the AChR binding site, εN182Y localizes to the interface with the α subunit, and εD175 to the entrance of the ACh binding cavity. Both εN182Y and εD175 show state specificity in affecting closed relative to desensitized state affinities, suggesting that the protein chain harboring εN182 and εD175 rearranges in the course of receptor desensitization. The overall results show that key residues at the ACh binding site differentially stabilize the agonist bound to closed, open and desensitized states, and provide a set point for gating of the channel.