The metabotropic glutamate receptor subtype 7 (mGlu7) is an important presynaptic regulator of neurotransmission in the mammalian CNS. mGlu7 function has been linked to autism, drug abuse, anxiety, and depression. Despite this, it has been difficult to develop specific blockers of native mGlu7 signaling in relevant brain areas such as amygdala and limbic cortex. Here, we present the mGlu7-selective antagonist 7-hydroxy-3-(4-iodophenoxy)-4H-chromen-4-one (XAP044), which inhibits lateral amygdala long term potentiation (LTP) in brain slices from wild type mice with a half-maximal blockade at 88 nm. There was no effect of XAP044 on LTP of mGlu7-deficient mice, indicating that this pharmacological effect is mGlu7-dependent. Unexpectedly and in contrast to all previous mGlu7-selective drugs, XAP044 does not act via the seven-transmembrane region but rather via a binding pocket localized in mGlu7's extracellular Venus flytrap domain, a region generally known for orthosteric agonist binding. This was shown by chimeric receptor studies in recombinant cell line assays. XAP044 demonstrates good brain exposure and wide spectrum anti-stress and antidepressant- and anxiolytic-like efficacy in rodent behavioral paradigms. XAP044 reduces freezing during acquisition of Pavlovian fear and reduces innate anxiety, which is consistent with the phenotypes of mGlu7-deficient mice, the results of mGlu7 siRNA knockdown studies, and the inhibition of amygdala LTP by XAP044. Thus, we present an mGlu7 antagonist with a novel molecular mode of pharmacological action, providing significant application potential in psychiatry. Modeling the selective interaction between XAP044 and mGlu7's Venus flytrap domain, whose three-dimensional structure is already known, will facilitate future drug development supported by computer-assisted drug design.