The alpha-factor pheromone receptor activates a G protein signaling pathway that induces the conjugation of the yeast Saccharomyces cerevisiae. Our previous studies identified AFR1 as a gene that regulates this signaling pathway because overexpression of AFR1 promoted resistance to alpha-factor. AFR1 also showed an interesting genetic relationship with the alpha-factor receptor gene, STE2, suggesting that the receptor is regulated by Afr1p. To investigate the mechanism of this regulation, we tested AFR1 for a role in the two processes that are known to regulate receptor signaling: phosphorylation and down-regulation of ligand-bound receptors by endocytosis. AFR1 overexpression diminished signaling in a strain that lacks the C-terminal phosphorylation sites of the receptor, indicating that AFR1 acts independently of phosphorylation. The effects of AFR1 overexpression were weaker in strains that were defective in receptor endocytosis. However, AFR1 overexpression did not detectably influence receptor endocytosis or the stability of the receptor protein. Instead, gene dosage studies showed that the effects of AFR1 overexpression on signaling were inversely proportional to the number of receptors. These results indicate that AFR1 acts independently of endocytosis, and that the weaker effects of AFR1 in strains that are defective in receptor endocytosis were probably an indirect consequence of their increased receptor number caused by the failure of receptors to undergo ligand-stimulated endocytosis. Analysis of the ligand binding properties of the receptor showed that AFR1 overexpression did not alter the number of cell-surface receptors or the affinity for alpha-factor. Thus, Afr1p prevents alpha-factor receptors from activating G protein signaling by a mechanism that is distinct from other known pathways.