The γ subunits of heterotrimeric G proteins are required for receptor-G protein coupling. The C-terminal domains of Gγ subunits can contact receptors and influence the efficiency of receptor-G protein coupling in vitro. However, it is unknown whether receptor interaction with the C terminus of Gγ is required for signaling in vivo. To address this question, we cloned Gγ homologs with diverged C-terminal sequences from five species of budding yeast. Each Gγ homolog functionally replaced the Gγ subunit of the yeast Saccharomyces cerevisiae (STE18 gene product). Mutagenesis of S. cerevisiae Ste18 likewise indicated that specific C-terminal sequence motifs are not required for signaling. Strikingly, an internal in-frame deletion removing sequences preceding the C-terminal CAAX box of Ste18 did not impair signaling by either of its cognate G protein-coupled pheromone receptors. Therefore, receptor interaction with the C-terminal domain of yeast Gγ is not required for receptor-mediated G protein activation in vivo. Because the mechanism of G protein activation by receptors is conserved from yeast to humans, mammalian receptors may not require interaction with the tail of Gγ for G protein activation in vivo. However, receptor-Gγ interaction may modulate the efficiency of receptor-G protein coupling or promote activation of Gβγ effectors that co-cluster with receptors.