Insects have a remarkably sensitive and sophisticated olfactory system providing information regarding the surrounding chemical world. The insect odorant receptors (ORs) are the most sensitive olfactory receptors recorded. Studying the molecular mechanism involved in insect olfaction provides insights into how olfactory input is translated into behavior. The present study was aimed at understanding the fundamental questions about ‘function and regulation of insect olfactory signaling’. To address our questions we employed pharmacological, molecular and physiological approaches on heterologously expressed insect olfactory receptors. The insect ORs form heteromeric complexes composed of a ligand binding protein (OrX) and a highly conserved ubiquitous coreceptor Orco. But the actual stoichiometry of this complex is unknown. Recent reports also suggest the presence of homomeric interactions between Orco proteins. In order to understand the function of Orco channel as an oligomer, we artificially engineered a minimal oligomeric construct, Orco dimer (Orco di) and expressed it in CHO (Chinese Hamster Ovary cells). With calcium imaging and patch clamp experiments we show that Orco di forms a functional ion channel and shows similar properties to those channels formed by Orco wt proteins. In addition to functional studies, this thesis provides insights on the regulation of insect olfactory receptor activity. In order to understand how intracellular calcium influx is regulated in the insects ORs we investigated the role of the ubiquitous Ca2+ binding protein calmodulin (CaM) in insect OR function. We identified a conserved putative CaM binding motif 336SAIKYWVER344 in the second intracellular loop of Orco protein indicating an important functional role. Pharmacological inhibition and overexpression of CaM mutants in heterologously expressed insect ORs showed that inhibition of CaM activity affects Ca2+ response of Orco channel, but with heteromeric ORs, CaM inhibition affected the response of ORs in OrX specific manner. Our results give ample evidence for CaM activity in modulating the function of insect odorant receptors. In a further study, where we replicated the process of sensitization event in heterologously expressed insect ORs, we observed that inhibition of CaM abolished this event. These results suggests a role of CaM in the Orco-mediated OR sensitization.