The Ras-related protein, activator of G-protein signaling 1 (AGS1) or Dexras1, interacts with G(i)/G(o)alpha and activates heterotrimeric G-protein signaling systems independent of a G-protein-coupled receptor (GPCR). As an initial approach to further define the cellular role of AGS1 in GPCR signaling, we determined the influence of AGS1 on the regulation of G(betagamma)-regulated inwardly rectifying K(+) channel (GIRK) current (I(ACh)) by M(2)-muscarinic receptor (M(2)-MR) in Xenopus oocytes. AGS1 expression inhibited receptor-mediated current activation by >80%. Mutation of a key residue (G31V) within the G(1) domain involved in nucleotide binding for Ras-related proteins eliminated the action of AGS1. The inhibition of I(ACh) was not overcome by increasing concentrations of the muscarinic agonist acetylcholine but was progressively lost upon injection of increasing amounts of M(2)-MR cRNA. These data suggest that AGS1 may antagonize GPCR signaling by altering the pool of heterotrimeric G-proteins available for receptor coupling and/or disruption of a preformed signaling complex. Such regulation would be of particular importance for those receptors that exist precoupled to heterotrimeric G-protein and for receptors operating within signaling complexes.