We demonstrate that the N terminus of GCAP-2, like those of other members of the recoverin family of Ca
2؉-binding proteins, is fatty acylated. However, unlike other proteins of this family, more GCAP-2 is present in the membrane fraction at low Ca 2؉ than at high Ca 2؉ concentrations. We investigated the role of the N-terminal fatty acyl residue in the ability of GCAP-2 to regulate RetGCs. Myristoylated or nonacylated GCAP-2 forms were expressed in Escherichia coli. Wild-type GCAP-2 and the Gly 2 3 Ala 2 GCAP-2 mutant, which is unable to undergo N-terminal myristoylation, were also expressed in mammalian HEK293 cells. We found that compartmentalization of GCAP-2 in photoreceptor outer segment membranes is Ca 2؉ -and ionic strength-sensitive, but it does not require the presence of the fatty acyl group and does not necessarily directly reflect GCAP-2 interaction with RetGC. The lack of myristoylation does not significantly affect the ability of GCAP-2 to stimulate RetGC. Nor does it affect the ability of the Ca 2؉ -loaded form of GCAP-2 to compete with the GCAP-2 mutant that constitutively activates RetGC. We conclude that while Ca 2؉ binding plays a major regulatory role in GCAP-2 function, it does not operate through a calcium-myristoyl switch similar to the one found in recoverin.