We report how rotational variations in transmembrane (TM) helix interactions participate in the activity states of the thrombopoietin receptor (TpoR), a type 1 cytokine receptor that controls the production of blood platelets. We also explore the mechanism of small-molecule agonists that do not mimic the natural ligand. We show, by a combination of cysteine cross-linking, alanine-scanning mutagenesis, and computational simulations, that the TpoR TM dimerizes strongly and can adopt 3 different stable, rotationally related conformations, which may correspond to specific states of the full-length receptor (active, inactive, and partially active). Thus, our data suggest that signaling and inactive states of the receptor are related by receptor subunit rotations, rather than a simple monomer-dimer transition. Moreover, results from experiments with and without agonists in vitro and in cells allow us to propose a novel allosteric mechanism of action for a class of small molecules, in which they activate TpoR by binding to the TM region and by exploiting the rotational states of the dimeric receptor. Overall, our results support the emerging view of the participation of mutual rotations of the TM domains in cytokine receptor activation.