In the later stages of Parkinson's disease (PD), patients often manifest levodopa-induced dyskinesia (LID), compromising their quality of life. The pathophysiology underlying LID is poorly understood, and treatment options are limited. To move toward filling this treatment gap, the intrinsic and synaptic changes in striatal spiny projection neurons (SPNs) triggered by the sustained elevation of dopamine (DA) during dyskinesia were characterized using electrophysiological, pharmacological, molecular and behavioral approaches. Our studies revealed that the intrinsic excitability and functional corticostriatal connectivity of SPNs in dyskinetic mice oscillate between the on- and off-states of LID in a cell- and state-specific manner. Although triggered by levodopa, these rapid oscillations in SPN properties depended on both dopaminergic and cholinergic signaling. In a mouse PD model, disrupting M1 muscarinic receptor signaling specifically in iSPNs or deleting its downstream signaling partner CalDAG-GEFI blunted the levodopa-induced oscillation in functional connectivity, enhanced the beneficial effects of levodopa and attenuated LID severity.