Novel 2,3-benzodiazepine and related isoquinoline derivatives, substituted at position 1 with a 2-benzothiophenyl moiety, were synthesized to produce compounds that potently inhibited the action of GABA on heterologously expressed GABAA receptors containing the alpha 5 subunit (GABAA α5), with no apparent affinity for the benzodiazepine site. Substitutions of the benzothiophene moiety at position 4 led to compounds with drug-like properties that were putative inhibitors of extra-synaptic GABAA α5 receptors and had substantial blood-brain barrier permeability. Initial characterization in vivo showed that 8-methyl-5-[4-(trifluoromethyl)-1-benzothiophen-2-yl]-1,9-dihydro-2H-[1,3]oxazolo[4,5-h][2,3]benzodiazepin-2-one was devoid of sedative, pro-convulsive or motor side-effects, and enhanced the performance of rats in the object recognition test. In summary, we have discovered a first-in-class GABA-site inhibitor of extra-synaptic GABAA α5 receptors that has promising drug-like properties and warrants further development.