1. The ATP-activated P2X2(a) and P2X2(b) receptor splice variants, which differ only in their C-terminal sequences, desensitize at different rates. We used mutational analysis to investigate the involvement of the C-terminal region in receptor desensitization. Rat wild-type and mutant P2X2 receptors were expressed in Xenopus oocytes and currents were measured using the two-electrode voltage-clamp technique. 2. Truncating P2X2 at the Lys369 splice site increased the rate of desensitization by >100-fold. Recovery from desensitization was slowed by approximately 5-fold. 3. Addition of Val370 onto the C-terminus of the truncated receptor slowed desensitization by approximately 70-fold. Point mutations that substituted either smaller or larger hydrophobic amino acids for Val370, within the P2X2(a) splice variant, had profound effects on the rate of desensitization. The rate decreased with increasing hydrophobicity but was not dependent upon the precise structure of the side group. 4. A mutant receptor, with only nine amino acids, Val-Asp-Pro-Lys-Gly-Leu-Ala-Gln-Leu, beyond the Lys369 splice site, desensitized at a similar rate to P2X2(a). Injection of the peptide of this sequence into oocytes expressing P2X2(a) increased the rate of desensitization, whereas the eight-residue peptide lacking the valine had no effect. 5. Neutralizing lysines in the vicinity of the splice site increased the rate of receptor desensitization. Substituting glutamine for Lys365 produced the greatest effect ( approximately 30-fold increase), whereas mutating lysines that were further upstream or downstream of this position had progressively less of an effect. 6. We conclude that the C-terminal splice site of the P2X2 receptor is located within a region that is critically involved in regulating the rate of receptor desensitization. The valine at position 370 interacts with an intracellular hydrophobic site to slow the rate of desensitization. Nearby lysines may facilitate this interaction.