-Arrestins are multifunctional adaptor proteins, which mediate desensitization, endocytosis, and alternate signaling pathways of seven membrane-spanning receptors (7MSRs). Crystal structures of the basal inactive state of visual arrestin (arrestin 1) and -arrestin 1 (arrestin 2) have been resolved. However, little is known about the conformational changes that occur in -arrestins upon binding to the activated phosphorylated receptor. Here we characterize the conformational changes in -arrestin 2 (arrestin 3) by comparing the limited tryptic proteolysis patterns and matrix-assisted laser desorption/ionization-time of flight mass spectrometry (MALDI-TOF MS) profiles of -arrestin 2 in the presence of a phosphopeptide (V 2 R-pp) derived from the C terminus of the vasopressin type II receptor (V 2 R) or the corresponding nonphosphopeptide (V 2 R-np). V 2 R-pp binds to -arrestin 2 specifically, whereas V 2 R-np does not. Activation of -arrestin 2 upon V 2 R-pp binding involves the release of its C terminus, as indicated by exposure of a previously inaccessible cleavage site, one of the polar core residues Arg 394 , and rearrangement of its N terminus, as indicated by the shielding of a previously accessible cleavage site, residue Arg 8 . Interestingly, binding of the polyanion heparin also leads to release of the C terminus of -arrestin 2; however, heparin and V 2 R-pp have different binding site(s) and/or induce different conformational changes in -arrestin 2. Release of the C terminus from the rest of -arrestin 2 has functional consequences in that it increases the accessibility of a clathrin binding site (previously demonstrated to lie between residues 371 and 379) thereby enhancing clathrin binding to -arrestin 2 by 10-fold. Thus, the V 2 R-pp can activate -arrestin 2 in vitro, most likely mimicking the effects of an activated phosphorylated 7MSR. These results provide the first direct evidence of conformational changes associated with the transition of -arrestin 2 from its basal inactive conformation to its biologically active conformation and establish a system in which receptor--arrestin interactions can be modeled in vitro.Seven membrane-spanning receptors (7MSRs), 1 also referred to as G protein-coupled receptors (GPCRs), constitute the largest known family of cell surface receptors (1, 2). The human genome encodes ϳ1,000 7MSRs, which function primarily in the transmission of diverse signals (including light, odorants, chemoattractants, neurotransmitters, and hormones) from the extracellular environment to the interior of the cell (1, 2). The dynamic sensitivity of 7MSR function is in large part a function of their regulation by the G proteincoupled receptor kinase (GRK)/-arrestin system (1, 3). This regulation is accomplished by a two-step process involving the phosphorylation of the receptor, usually at its C terminus, by GRKs, and the subsequent binding of -arrestins, which prevents further receptor activation of G proteins (desensitization) (1, 4). -Arrestin binding to the receptor also f...