Many animals are able to sense the Earth’s geomagnetic field to enable behaviors such as migration. It is proposed that the magnitude and direction of the geomagnetic field modulates the activity of cryptochrome (CRY) by influencing photochemical radical pair intermediates within the protein. However, this proposal will remain theoretical until a CRY-dependent effect on a receptor neuron is shown to be modified by an external magnetic field (MF). It is established that blue-light (BL) photoactivation of CRY is sufficient to depolarize and activate Drosophila neurons. Here, we show that this CRY-dependent effect is significantly potentiated in the presence of an applied MF (100 mT). We use electrophysiological recordings from larval identified motoneurons, in which CRY is ectopically expressed, to show that BL-dependent depolarization of membrane potential and increased input resistance are markedly potentiated by an MF. Analysis of membrane excitability shows that these effects of MF exposure evoke increased action potential firing. Almost nothing is known about the mechanism by which a magnetically induced change in CRY activity might produce a behavioral response. We further report that specific structural changes to the protein alter the impact of the MF in ways that are strikingly similar to those from recent behavioral studies into the magnetic sense of Drosophila. These observations provide the first direct experimental evidence to support the hypothesis that MF modulation of CRY activity is capable of influencing neuron activity to allow animal magnetoreception.