The structural plasticity of G-protein coupled receptors (GPCRs) enables the long-range transmission of conformational changes induced by specific orthosteric site ligands and other pleiotropic factors. Here, we demonstrate that the ligand binding cavity in the sphingosine 1-phosphate receptor S1PR1, a class A GPCR, is in allosteric communication with both the β-arrestin-binding C-terminal tail, and a receptor surface involved in oligomerization. We show that S1PR1 oligomers are required for full response to different agonists and ligand-specific association with arrestins, dictating the downstream signalling kinetics. We reveal that the active form of the immunomodulatory drug fingolimod, FTY720-P, selectively harnesses both these intramolecular networks to efficiently recruit β-arrestins in a stable interaction with the receptor, promoting deep S1PR1 internalization and simultaneously abrogating ERK1/2 phosphorylation. Our results define a molecular basis for the efficacy of fingolimod for people with multiple sclerosis, and attest that GPCR signalling can be further fine-tuned by the oligomeric state.