G protein coupled receptors (GPCRs) are membrane proteins that signal through effector proteins bound at the intracellular (IC) interface. Under physiological conditions, GPCRs adopt multiple inactive and active conformations, thereby signaling through diverse signaling pathways. Binding of agonists at the extracellular (EC) domain initiates a conformational change in the receptor leading to activation. Antagonists and inverse agonists suppress activation by stabilizing one of the inactive states. The communication between the agonist/antagonist binding site and the IC interface takes place through allosteric coupling of distant receptor domains. However, the detailed mechanism of allosteric communication in GPCR signaling is not well understood. Using ensembles of molecular dynamics (MD) simulations on eight class A GPCRs, we showed that allosteric communication between the antagonist binding site and the IC interface stabilizes the inactive state, and disruption of this allosteric communication due to agonist binding leads to activation. Furthermore, the fundamental framework and mechanism of allosteric communication are conserved among multiple GPCRs, as is evident from the conserved allosteric hubs (residues that mediate multiple allosteric pathways) in these receptors. Mutating the allosteric hubs either suppress activation or impart constitutive activity, suggesting the key role of these residues in GPCR function. We have shown that, besides stabilizing GPCR functional states, allosteric communication is also responsible for transitions among functional states. Analysis of the deactivation dynamics of two class A GPCRs (β2 adrenergic receptor and neurotensin receptor 1) shows that several allosteric hubs in the middle of the transmembrane domain undergo concerted dihedral changes during the transition from the active to the inactive state. These observations provide valuable insights into the complex mechanism of GPCR activation and membrane protein function in general.