Colocalized in membrane barriers, the ABC transporters ABCB1 and ABCG2 strongly contribute to multidrug resistance (MDR). Here we investigate the as yet unknown mechanisms of activation and inhibition of ABCG2. For this purpose we measured the ATPase activity of ABCG2 and ABCB1 as a function of allocrite concentration using a calibration set of 30 diverse compounds and a validation set of 23 compounds. We demonstrate that ABCG2 is activated at low and inhibited at high allocrite concentrations, yielding bell-shaped activity curves. With an ATP regeneration assay we prove that the inhibitory part is indeed due to a decrease in activity because of high allocrite load in the transporter. However, inhibition is only observed if the membrane solubility of allocrites is sufficiently high. The concentrations of half-maximum activation and inhibition are at least 10-fold lower for ABCG2 than for ABCB1. Because ABCG2 binds its allocrites with higher affinity than ABCB1, it can extract hydrophilic, nonamphiphilic, and highly charged compounds out of the lipid membrane, typically exhibiting low lipid-water partition coefficients, but is inhibited by hydrophobic, amphiphilic, and moderately charged compounds, with high lipid-water partition coefficients. In contrast, ABCB1 is barely interacting with hydrophilic compounds, but is activated by hydrophobic compounds. We show that hydrophobicity, amphiphilicity, and charge have a dual role; they predict, on the one hand, allocrites' lipid-water partition coefficient and, on the other hand, the transporters' preference for the chemical nature of allocrites. Parameters reflecting hydrophobicity, amphiphilicity, and charge are therefore sufficient for differentiating between allocrites, activators, and inhibitors of ABCB1 and ABCG2.