Photoactive yellow protein (PYP) is a small bacterial photoreceptor that undergoes a light-activated reaction cycle. PYP is also the prototypical Per-Arnt-Sim (PAS) domain. PAS domains, found in diverse multi-domain proteins from bacteria to humans, mediate protein-protein interactions and function as sensors and signal transducers. Here, we investigate conformational and dynamic changes in solution in wild-type PYP upon formation of the long-lived putative signaling intermediate I2 with enhanced hydrogen/deuterium exchange mass spectrometry (DXMS). The DXMS results showed that the central beta-sheet remains stable but specific external protein segments become strongly deprotected. Light-induced disruption of the dark-state hydrogen bonding network in I2 produces increased flexibility and opening of PAS core helices alpha3 and alpha4, releases the beta4-beta5 hairpin, and propagates conformational changes to the central beta-sheet. Surprisingly, the first approximately 10 N-terminal residues, which are essential for fast dark-state recovery from I2, become more protected. By combining the DXMS results with our crystallographic structures, which reveal detailed changes near the chromophore but limited protein conformational change, we propose a mechanism for I2 state formation. This mechanism integrates the results from diverse biophysical studies of PYP, and links an allosteric T to R-state conformational transition to three pathways for signal propagation within the PYP fold. On the basis of the observed changes in PYP plus commonalities shared among PAS domain proteins, we further propose that PAS domains share this conformational mechanism, which explains the versatile signal transduction properties of the structurally conserved PYP/PAS module by framework-encoded allostery.