Presynaptic inhibitory G protein-coupled receptors (GPCRs) can decrease neurotransmission by inducing interaction of Gbetagamma with the soluble N-ethylmaleimide-sensitive factor attachment protein receptor (SNARE) complex. We have shown that this action of Gbetagamma requires the carboxyl terminus of the 25-kDa synaptosome-associated protein (SNAP25) and is downstream of the well known inhibition of Ca2+ entry through voltage-gated calcium channels. We propose a mechanism in which Gbetagamma and synaptotagmin compete for binding to the SNARE complex. Here, we characterized the Gbetagamma interaction sites on syntaxin1A and SNAP25 and demonstrated an overlap of the Gbetagamma- and synaptotagmin I -binding regions on each member of the SNARE complex. Synaptotagmin competes in a Ca2+-sensitive manner with binding of Gbetagamma to SNAP25, syntaxin1A, and the assembled SNARE complex. We predict, based on these findings, that at high intracellular Ca2+ concentrations, Ca2+-synaptotagmin I can displace Gbetagamma binding and the Gbetagamma-dependent inhibition of exocytosis can be blocked. We tested this hypothesis in giant synapses of the lamprey spinal cord, where 5-HT works via Gbetagamma to inhibit neurotransmission (Blackmer et al., 2001). We showed that increased presynaptic Ca2+ suppresses the 5-HT- and Gbetagamma-dependent inhibition of exocytosis. We suggest that this effect may be due to Ca2+-dependent competition between Gbetagamma and synaptotagmin I for SNARE binding. This type of dynamic regulation may represent a novel mechanism for modifying transmitter release in a graded manner based on the history of action potentials that increase intracellular Ca2+ concentrations and of inhibitory signals through G(i)-coupled GPCRs.