1. To gain insight into the role of the cytoplasmic regions of the Kir6.2 subunit in regulating channel activity, we have expressed the sulphonylurea receptor SUR1 with Kir6.2 subunits containing systematic truncations of the N- and C-termini. Up to 30 amino acids could be truncated from the N-terminus, and up to 36 amino acids from the C-terminus without loss of functional channels in co-expression with SUR1. Furthermore, Kir6.2ΔC25 and Kir6.2ΔC36 subunits expressed functional channels in the absence of SUR1. 2. In co-expression with SUR1, N-terminal truncations increased K(i,ATP) ([ATP] causing half-maximal inhibition of channel activity) by as much as 10-fold, accompanied by an increase in the ATP-insensitive open probability whereas the C-terminal truncations did not affect the ATP sensitivity of co-expressed channels. 3. A mutation in the near C-terminal region, K185Q, reduced ATP sensitivity of co-expressed channels by approximately 30-fold, and on the Kir6.2ΔN2-30 background, this mutation decreased ATP sensitivity of co-expressed channels by approximately 400-fold. 4. Each of these mutations also reduced the sensitivity to inhibition by ADP, AMP and adenosine tetraphosphate. 5. The results can be quantitatively explained by assuming that the N-terminal deletions stabilize the ATP-independent open state, whereas the Kir6.2K185Q mutation may alter the stability of ATP binding. These two effects are energetically additive, causing the large reduction of ATP sensitivity in the double mutant channels.