G protein-coupled receptors (GPCRs) form dimeric or oligomeric complexes in vivo. However, the function of oligomerization in receptor-mediated G protein activation is unclear. Previous studies of the yeast α-factor receptor (STE2 gene product) have indicated that oligomerization promotes signaling. Here we have addressed the mechanism by which oligomerization facilitates G protein signaling by examining the ability of ligand binding- and G protein coupling-defective α-factor receptors to form complexes in vivo and to correct their signaling defects when co-expressed (trans complementation). Newly and previously identified receptor mutants indicated that ligand binding involves the exofacial end of transmembrane domain (TM) 4, whereas G protein coupling involves ic1, ic3, the C-terminal tail, and the intracellular ends of TM2 and TM3. Mutant receptors bearing substitutions in these domains formed homo-oligomeric or hetero-oligomeric complexes in vivo, as indicated by results of fluorescence resonance energy transfer experiments. Co-expression of ligand binding- and G protein coupling-defective mutant receptors did not significantly improve signaling. In contrast, co-expression of ic1 and ic3 mutations in trans but not in cis significantly increased signaling efficiency. Therefore, we suggest that subunits of the α-factor receptor: 1) are activated independently rather than cooperatively by agonist, and 2) function in a concerted fashion to promote G protein activation, possibly by contacting different subunits or regions of the G protein heterotrimer.