Recent breakthroughs in neurobiology indicate that time is ripe to understand the cellular-level mechanisms of conscious experience. Accordingly, we have recently proposed that conscious processing depends on the integration between top-down and bottom-up information streams and that there exists a specific cellular mechanism that gates this integration. I will first describe this cellular mechanism and demonstrate how it controls signal propagation within the thalamocortical system. Then I will show how this cellular-level mechanism provides a natural explanation for why conscious experience is modulated by top-down processing. Besides shining new light on the neural basis of consciousness, this perspective unravels the mechanisms of internally generated perception, such as dreams, imagery, and hallucinations.