Methicillin-resistant strains of Staphylococcus aureus (MRSA) are the major cause of infections worldwide. Transcription of the beta-lactamase and PBP2a resistance genes is mediated by two closely related signal-transducing integral membrane proteins, BlaR1 and MecR1, upon binding of the beta-lactam inducer to the sensor domain. Herein we report the crystal structure at 1.75 A resolution of the sensor domain of BlaR1 in complex with a cephalosporin antibiotic. Activation of the signal transducer involves acylation of serine 389 by the beta-lactam antibiotic, a process promoted by the N-carboxylated side chain of Lys392. We present evidence that, on acylation, the lysine side chain experiences a spontaneous decarboxylation that entraps the sensor in its activated state. Kinetic determinations and quantum mechanical/molecular mechanical calculations and the interaction networks in the crystal structure shed light on how this unprecedented process for activation of a receptor may be achieved and provide insights into the mechanistic features that differentiate the signal-transducing receptor from the structurally related class D beta-lactamases, enzymes of antibiotic resistance.