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Olfaction appears to be mediated by a large family of odorant receptors (ORs) that accounts for ~ 1% of the human genome [1–4]. The functional characterization of these receptors has so far been hindered by their poor functional expression in the plasma membrane of heterologous cells. In order to investigate the problem of inefficient OR membrane targeting, sequential stages in the life cycle of the human OR17-40 were monitored. The modification of the receptor by different tags enabled the direct visualization of its biogenesis and trafficking in HEK293 cells. A multi-color labelling approach, which involved fluorescent subcellular markers as well as the spectral separation of membrane-inserted and intracellularly located receptors, indicated that high overexpression led to the accumulation of the receptor in the ER, whereas low expression levels improved its membrane targeting. To increase the efficiency of OR-mediated signalling, fluorescence-activated cell sorting of a functional OR17-40 – GFP fusion protein was used to separate low from high expressing cells, thus increasing the fraction of odorant-responsive cells up to 80% of the total cell population. Selectively labelled cell surface receptors accumulated over time in intracellular compartments, indicating constitutive receptor internalization. This process, which was independent of receptor activation, occurred along the clathrin-mediated pathway. Moreover, the imaging of single receptors in the plasma membrane indicated that, in absence of ligand, part of the receptors are already confined within small domains of 195 ± 10 nm. This fraction, which increased upon agonist or antagonist binding, probably corresponds to receptors located in clathrin-coated prepits. Odorant molecules structurally related to the cognate agonist helional were tested for their ability to activate OR17-40. It was found that an aldehyde group connected to an aromatic ring via a carbon chain of defined length and containing a methyl group in alpha or beta position is necessary for activating the receptor. In addition, first evidence for an OR17-40-specific antagonism was provided. Finally, OR17-40 activation was monitored in cell-derived native vesicles, opening new ways for assay miniaturization and the development of odorant screenings in a micro-array format.