SUMMARY In order to respond appropriately to threats in the environment, the brain must rapidly determine whether a stimulus is important and whether it is positive or negative, and then use that information to direct behavioral responses. Neurons in the amygdala have long been implicated in valence encoding and in fear responses to threatening stimuli, but show transient firing responses in response to these stimuli that do not match the timescales of associated behavioral responses. For decades, there has been a logical gap in how behavioral responses could be mediated without an ensemble representation of the internal state of valence that has rapid onset, high signal-to-noise, and is sustained for the duration of the behavioral state. Here, we present the amygdalostriatal transition zone (ASt) as a missing piece of this highly conserved process that is of paramount importance for survival, which does exactly this: represents an internal state (e.g. fear) that can be expressed in multiple motor outputs (e.g. freezing or escape). The ASt is anatomically positioned as a “shortcut” to connect the corticolimbic system (important for evaluation) with the basal ganglia (important for action selection) with the inputs of the amygdala and the outputs of the striatum – ideally poised for evaluating and responding to environmental threats. From in vivo cellular resolution recordings that include both electrophysiology and calcium imaging, we find that ASt neurons are unique in that they are sparse coding, extremely high signal-to-noise, and also maintain a sustained response for negative valence stimuli for the duration of the defensive behavior – a rare but essential combination. We further show that photostimulation of the ASt is sufficient to drive freezing and avoidance behaviors. Using single-nucleus RNA sequencing and in situ RNA labelling we generate a comprehensive profile of cell types and gene expression in the ASt, and find the ASt is genetically distinct from adjacent striatal and amygdalar structures. We also find that the ASt has a greater proportion of neurons expressing Drd2 than neurons expressing Drd1a , a unique feature compared to other regions of the striatum. Using in vivo calcium imaging, we show that that this Drd2+ population robustly encodes stimuli of negative valence, and in loss-of-function experiments find that optogenetic inhibition of Drd2+ ASt neurons causes a striking reduction in cue-conditioned fear responses. Together, our findings identify the ASt as a previously-unappreciated critical missing link for encoding learned associations and directing ongoing behavior.