XY1029 is a positive allosteric modulator of β2/β3 subunit containing GABA_A receptor subtypes. It has been selected as the lead compound from a series of quinolone derivatives that are related to antibiotics that have been in clinical use for over 25 years. These highly selective and specific modulators of β2/β3 subunit containing GABA _A receptor subtypes show anxiolytic activity levels comparable to diazepam, without the sedative side effects typically associated with benzodiazepines (BZs). XY1029 shows BZ-like anxiolytic activity in three well established animal models of anxiety: the mouse light-dark transition test, rat elevated plus maze test, and rat Vogel conflict test. XY1029 has a favorable acute safety pharmacology profile, with a high therapeutic index. Unlike BZs, it does not cause sedation or ataxia nor does it potentiate the CNS depressant action of ethanol. Interaction with other CNS receptors was not observed up to a concentration of 10 micromolar. In summary, XY1029 holds great potential as a novel anxiolytic drug with fewer side effects and robust clinical efficacy as compared to currently available anti-anxiety medications. Completion of toxicology studies and the filing of an IND are planned.