The production of cAMP is controlled on many levels, notably at the level of cAMP synthesis by the enzyme adenylyl cyclase. We have recently identified a new regulator of adenylyl cyclase activity, RGS2, which decreases cAMP accumulation when overexpressed in HEK293 cells and inhibits the in vitro activity of types III, V, and VI adenylyl cyclase. In addition, RGS2 blocking antibodies lead to elevated cAMP levels in olfactory neurons. Here we examine the nature of the interaction between RGS2 and type V adenylyl cyclase. In HEK293 cells expressing type V adenylyl cyclase, RGS2 inhibited Galpha(s)-Q227L- or beta(2)-adrenergic receptor-stimulated cAMP accumulation. Deletion of the N-terminal 19 amino acids of RGS2 abolished its ability to inhibit cAMP accumulation and to bind adenylyl cyclase. Further mutational analysis indicated that neither the C terminus, RGS GAP activity, nor the RGS box domain is required for inhibition of adenylyl cyclase. Alanine scanning of the N-terminal amino acids of RGS2 identified three residues responsible for the inhibitory function of RGS2. Furthermore, we show that RGS2 interacts directly with the C(1) but not the C(2) domain of type V adenylyl cyclase and that the inhibition by RGS2 is independent of inhibition by Galpha(i). These results provide clear evidence for functional effects of RGS2 on adenylyl cyclase activity that adds a new dimension to an intricate signaling network.