Benzodiazepines (BZDs) have been a standard treatment for anxiety disorders for decades, but the neuronal circuit interactions mediating their anxiolytic effect remain largely unknown. Here, we find that systemic BZDs modulate central amygdala (CEA) microcircuit activity to gate amygdala output. Combining connectome data with immediate early gene (IEG) activation maps, we identified the CEA as a primary site for diazepam (DZP) anxiolytic action. Deep brain calcium imaging revealed that brain-wide DZP interactions shifted neuronal activity in CEA microcircuits. Chemogenetic silencing showed that PKCδ+/SST− neurons in the lateral CEA (CEAl) are necessary and sufficient to induce the DZP anxiolytic effect. We propose that BZDs block the relay of aversive signals through the CEA, in part by local binding to CEAl SST+/PKCδ− neurons and reshaping intra-CEA circuit dynamics. This work delineates a strategy to identify biomedically relevant circuit interactions of clinical drugs and highlights the critical role for CEA circuitry in the pathophysiology of anxiety.