We review osmotic stress studies of the G-protein-coupled receptor rhodopsin. Despite the established presence of small amounts of structural water in these receptors, the influence of bulk water on their function remains unknown. Investigations of osmotic stress effects on the GPCR archetype rhodopsin have provided unique data about the role of water in receptor activation. It was discovered that osmolytes shift the rhodopsin equilibrium after photoactivation, either to the active or inactive conformations depending on their molar mass. Experimentally at least 80 water molecules have been found to enter rhodopsin in the transition to the active state. We propose that this influx of water is a necessary condition for receptor activation. If the water movement is blocked, e.g., by large osmolytes or by dehydration, then the receptor does not undergo its functional transition. The results suggest a new model whereby rhodopsin becomes swollen and partially unfolded in the activation mechanism. Water thus acts as a powerful allosteric modulator of functioning for rhodopsin-like receptors.