The type I insulin-like growth factor receptor (IGF1R) is involved in growth and survival of normal and neoplastic cells. A ligand-dependent conformational change is thought to regulate IGF1R activity, but the nature of this change is unclear. We point out an underappreciated dimer in the crystal structure of the related Insulin Receptor (IR) with Insulin bound that allows direct comparison with unliganded IR and suggests a mechanism by which ligand regulates IR/IGF1R activity. We test this mechanism in a series of biochemical and biophysical assays and find the IGF1R ectodomain maintains an autoinhibited state in which the TMs are held apart. Ligand binding releases this constraint, allowing TM association and unleashing an intrinsic propensity of the intracellular regions to autophosphorylate. Enzymatic studies of full-length and kinase-containing fragments show phosphorylated IGF1R is fully active independent of ligand and the extracellular-TM regions. The key step triggered by ligand binding is thus autophosphorylation.