G protein-coupled receptors at the plasma membrane control most biological processes and are a major drug target. Activated receptors traffic to endosomes, but whether endosomal receptors generate signals that underlie complex pathophysiological processes is unexplored. We examined whether the substance P (SP) neurokinin 1 receptor (NK1R) generates signals that underlie pain transmission. We examined SP-induced trafficking of the NK1R in HEK293 cells using bioluminescence resonance energy transfer (BRET) and super-resolution microscopy. SP decreased NK1R and KRas (resident plasma membrane protein) BRET and increased NK1R and Rab5a (early endosomal protein) BRET, consistent with receptor endocytosis. Pharmacological and genetic inhibitors of clathrin and dynamin blocked endocytosis. We studied the generation of second messengers in subcellular compartments of HEK293 cells using Förster resonance energy transfer biosensors. Endocytic inhibitors and the Gαq inhibitor UBO-CIQ blocked SP-induced activation of cytosolic cAMP, cytosolic protein kinase C, and nuclear extracellular signal regulated kinase (ERK), indicating a key role for NK1R endocytosis and Gαq in the full complement of NK1R signaling events. Super-resolution microscopy confirmed the colocalization of NK1R and Gαq in early endosomes. We examined the effects of SP on NK1R endocytosis (immunofluorescence, confocal microscopy) and excitability (patch clamp recording) in spinal neurons in slices. SP caused a NK1R endocytosis and sustained excitability. Dynamin inhibitors blocked endocytosis and excitability, consistent with a role for NK1R endocytosis in neuronal excitation. In mice and rats, intraplantar injection of capsaicin, formalin and complete Freund’s adjuvant evoked NK1R endocytosis and activation of ERK in lamina I spinal neurons, and caused sustained hyperalgesia. Intrathecal injection of endocytic inhibitors blocked NK1R endocytosis, ERK signaling, and hyperalgesia, revealing a major role for NK1R endocytosis in pain transmission. Our results reveal a critical role for endosomal signaling of G protein-coupled receptors in the complex pathophysiology of pain, and suggest the utility of endosomally-targeted antagonists.