Present in all kingdoms of life, ATP-binding cassette (ABC) transporters couple ATP hydrolysis to mechanical force and facilitate trafficking of diverse substrates across biological membranes. Although many ABC transporters are promising drug targets, their mechanisms of regulation by small molecule inhibitors remain largely unknown. Herein, we used the lipopolysaccharide (LPS) flippase MsbA, a prototypical ABC exporter, as a model system to probe mechanisms of allosteric modulation by compounds binding to the transmembrane domains (TMDs). Recent chemical screens have identified intriguing LPS transport inhibitors targeting MsbA: the ATPase stimulator TBT1 and the ATPase inhibitor G247. Despite preliminary biochemical and structural data, it is unclear how TBT1 and G247 bind to the MsbA TMDs yet induce opposite allosteric effect in the nucleotide-binding domains (NBDs). Through single-particle EM, mutagenesis and activity assay, we show that TBT1 and G247 bind adjacent yet separate locations in the TMDs, inducing drastic changes in TMD conformation and NBD positioning. Two TBT1 molecules asymmetrically occupy the LPS binding site to break the symmetry of MsbA, resulting in disordered transmembrane helices and decreased NBD distance. In this novel inhibited ABC transporter state, decreased distance between the NBDs causes stimulation of ATP hydrolysis yet LPS transport blockage. In contrast, G247 acts as a TMDs wedge, symmetrically increasing NBD separation and preventing conformational transition of MsbA. Our study uncovers the distinct mechanisms of the first-generation MsbA-specific inhibitors and demonstrates that rational design of substrate-mimicking compounds can be exploited to develop useful ABC transporter modulators.