The soluble fraction from the ileal longitudinal muscle of guinea pigs was examined for the presence of an endogenous modulator of muscarinic receptors. In the presence of the soluble fraction, the binding of [3H]quinuclidinyl benzilate to the membranes from the tissue was inhibited in a concentration-dependent manner. The inhibitory activity in the soluble fraction was heat stable, but was inactivated by trypsin treatment. Several protease inhibitors had no effect on the inhibitory activity. These results suggest the existence of an endogenous protein that inhibits the binding of the muscarinic ligand to the receptor. Ultrafiltration demonstrated that the protein factor had a molecular mass of more than 10,000 Da. Saturation binding and dissociation kinetic experiments indicate neither a competitive nor allosteric mode of inhibitory action and suggest that an irreversible block or internalization of muscarinic receptors is induced by the endogenous protein.