Key points Kainate receptors (KARs) are ionotropic glutamate receptors (iGluRs) that modulate synaptic transmission and intrinsic neuronal excitability. KARs associate with the auxiliary proteins neuropilin‐ and tolloid‐like 1 and 2 (Neto1 and Neto2), which act as allosteric modulators of receptor function impacting all biophysical properties of these receptors studied to date. M3–S2 linkers play a critical role in KAR gating; we found that individual residues in these linkers bidirectionally influence Neto2 modulation of KAR desensitization in an agonist specific manner. We also identify the D1 dimer interface as a novel site of Neto2 modulation and functionally correlate the actions of Neto2 modulation of desensitization with modulation of cation sensitivity. We identify these domains as determinants of Neto2 modulation. Thus, our work contributes to the understanding of auxiliary subunit modulation of KAR function and could aid the development of KAR‐specific modulators to alter receptor function. Abstract Kainate receptors (KARs) are important modulators of synaptic transmission and intrinsic neuronal excitability in the CNS. Their activity is shaped by the auxiliary proteins Neto1 and Neto2, which impact KAR gating in a receptor subunit‐ and Neto isoform‐specific manner. The structural basis for Neto modulation of KAR gating is unknown. Here we identify the M3–S2 gating linker as a critical determinant contributing to Neto2 modulation of KARs. M3–S2 linkers control both the valence and magnitude of Neto2 modulation of homomeric GluK2 receptors. Furthermore, a single mutation in this domain abolishes Neto2 modulation of heteromeric receptor desensitization. Additionally, we found that cation sensitivity of KAR gating is altered by Neto2 association, suggesting that stability of the D1 dimer interface in the ligand‐binding domain (LBD) is an important determinant of Neto2 actions. Moreover, modulation of cation sensitivity was eliminated by mutations in the M3–S2 linkers, thereby correlating the action of Neto2 at these structurally discrete sites on receptor subunits. These results demonstrate that the KAR M3–S2 linkers and LBD dimer interface are critical determinants for Neto2 modulation of receptor function and identify these domains as potential sites of action for the targeted development of KAR‐specific modulators that alter the function of auxiliary proteins in native receptors.