RGS4, a mammalian GTPase activating protein for G protein α subunits, was identified by its ability to inhibit the pheromone response pathway in Saccharomyces cerevisiae . To define regions of RGS4 necessary for its function in vivo , we assayed mutants for activity in this system. Deletion of the N-terminal 33 aa of RGS4 (Δ1–33) yielded a nonfunctional protein and loss of plasma membrane localization. These functions were restored by addition of a C-terminal membrane-targeting sequence to RGS4 (Δ1–33). Thus, plasma membrane localization is tightly coupled with the ability of RGS4 to inhibit signaling. Fusion of the N-terminal 33 aa of RGS4 to green fluorescent protein was sufficient to localize an otherwise soluble protein to the plasma membrane, defining this N-terminal region as a plasma membrane anchorage domain. RGS4 is palmitoylated, with Cys-2 and Cys-12 the likely sites of palmitoylation. Surprisingly, mutation of the cysteine residues within the N-terminal domain of RGS4 did not affect plasma membrane localization in yeast or the ability to inhibit signaling. Features of the N-terminal domain other than palmitoylation are responsible for the plasma membrane association of RGS4 and its ability to inhibit pheromone response in yeast.