Resistance of nematodes to anthelmintics such as avermectins has emerged as a major global health and agricultural problem, but genes conferring natural resistance to avermectins are unknown. We show that a naturally occurring four-amino-acid deletion in the ligand-binding domain of GLC-1, the alpha-subunit of a glutamate-gated chloride channel, confers resistance to avermectins in the model nematode Caenorhabditis elegans. We also find that the same variant confers resistance to the avermectin-producing bacterium Streptomyces avermitilis. Population-genetic analyses identified two highly divergent haplotypes at the glc-1 locus that have been maintained at intermediate frequencies by long-term balancing selection. These results implicate variation in glutamate-gated chloride channels in avermectin resistance and provide a mechanism by which such resistance can be maintained.