A transgenic bacterial cell comprising (a) a dimeric small molecule which comprises a first moiety known to bind a first receptor domain covalently linked to a second moiety known to bind a second receptor domain; (b) nucleotide sequences which upon transcription encode i) a first fusion protein comprising the first receptor domain, and ii) a second fusion protein comprising the second receptor domain; and (c) a reporter gene wherein expression of the reporter gene is conditioned on the proximity of the first fusion protein to the second fusion protein. The cell is also adapted for use in a method for identifying a molecule that binds to a known target in a bacterial cell from a pool of candidate molecules, and a method for identifying an unknown target receptor to which a molecule is capable of binding in a bacterial cell. Also described are compounds and kits for carrying out the methods.