ArfA rescues ribosomes stalled on truncated mRNAs by recruiting release factor RF2, which normally binds stop codons to catalyze peptide release. We report two 3.2 A resolution cryo-EM structures - determined from a single sample - of the 70S ribosome with ArfA*RF2 in the A site. In both states, the ArfA C-terminus occupies the mRNA tunnel downstream of the A site. One state contains a compact inactive RF2 conformation. Ordering of the ArfA N-terminus in the second state rearranges RF2 into an extended conformation that docks the catalytic GGQ motif into the peptidyl-transferase center. Our work thus reveals the structural dynamics of ribosome rescue. The structures demonstrate how ArfA 'senses' the vacant mRNA tunnel and activates RF2 to mediate peptide release without a stop codon, allowing stalled ribosomes to be recycled.