We provide here a detailed characterization of two isoforms of the protein kinase inhibitor (PKI) protein of cAMP-dependent protein kinase that have dramatically different inhibition constants. Murine PKI beta 1 possesses a 32-fold higher Ki than murine PKI alpha as determined by Henderson analysis. This finding led to the investigation of C subunit.PKI interactions involving nonconserved regions in the carboxyl and amino termini of murine PKI alpha and PKI beta 1. Chimeric cDNAs coding for amino acid sequences from both PKI isoforms were constructed and expressed in bacteria. Surprisingly, exchanging the carboxyl-terminal two-thirds of PKI alpha and PKI beta 1 has relatively little effect on the inhibition constants of the two isoforms. Similarly, introducing amino acid residues corresponding to a beta-turn region of PKI alpha into PKI beta 1 fails to lower PKI beta 1 inhibition constants. However, introducing the amino-terminal alpha-helical region of PKI alpha into PKI beta 1 reduces the Ki and IC50 of PKI beta 1 to values identical with full length PKI alpha. Site-directed mutagenesis of specific residues within this region implicates the presence of a tyrosine at position 7 in PKI alpha as a major contributor to its enhanced inhibitory potency. The results of this study suggest that variations in C subunit.PKI interactions within an amino-terminal alpha-helix provide a major mechanism for altering the inhibitory properties of PKI isoforms.