The cGMP-gated cation channel mediating phototransduction in retinal rods has recently been shown to be inhibited by calcium-calmodulin, through direct binding of the latter to the beta-subunit of the heterotetrameric channel complex. Here, we report the characterization of this inhibition and the identification of a domain crucial for this modulation. Heterologous expression of the alpha- and beta-subunits of the human rod channel in HEK 293 cells produced a cGMP-gated current that was highly sensitive to calcium-calmodulin, with half-maximal inhibition at approximately 4 nM. In biochemical and electrophysiological experiments on deletion mutants of the beta-subunit, we have identified a region on its cytoplasmic N terminus that binds calmodulin and is necessary for the calmodulin-mediated inhibition of the channel. However, in gel shift assays and fluorescence emission experiments, peptides derived from this region indicated a low calmodulin affinity, with dissociation constants of approximately 3-10 microM. On the C terminus, a region was also found to bind calmodulin, but it was likewise of low affinity, and its deletion did not abolish the calmodulin-mediated inhibition. We suggest that although the identified region on the N terminus of the beta-subunit is crucial for the calmodulin effect, other regions are likely to be involved as well. In this respect, the rod channel appears to differ from the olfactory cyclic nucleotide-gated channel, which is also modulated by calcium-calmodulin.