Glucocorticoid receptor (GR) binds to genomic response elements and regulates gene transcription with cell and gene specificity. Within a response element, the precise sequence to which the receptor binds has been implicated in directing its structure and activity. Here, we use NMR chemical-shift difference mapping to show that nonspecific interactions with bases at particular positions in the binding sequence, such as those of the 'spacer', affect the conformation of distinct regions of the rat GR DNA-binding domain. These regions include the DNA-binding surface, the 'lever arm' and the dimerization interface, suggesting an allosteric pathway that signals between the DNA-binding sequence and the associated dimer partner. Disrupting this pathway by mutating the dimer interface alters sequence-specific conformations, DNA-binding kinetics and transcriptional activity. Our study demonstrates that GR dimer partners collaborate to read DNA shape and to direct sequence-specific gene activity.