The C-terminus ends of the second putative transmembrane domains of both M1 and M2 muscarinic receptors contain a triplet of amino acid residues consisting of leucine (L), tyrosine (Y) and threonine (T). This triplet is repeated as LYT-TYL in M1 receptors at the interface between the second transmembrane domain and the first extracellular loop. Interestingly, however, it is repeated in a transposed fashion (LYT-LYT) in the sequence of M2 receptors. In our previous work, we investigated the possible significance of this unique sequence diversity for determining the distinct differential receptor function at the two receptor subtypes. However, we found mutation of the LYTTYL sequence of M1 receptors to the corresponding M2 receptor LYTLYT sequence demonstrated markedly enhanced the stimulation of phosphoinositide (PI) hydrolysis by carbachol without a change in its coupling to increased cyclic AMP formation. In this work, thus, the enhanced stimulation of PI hydrolysis in the LYTLYT M1 receptor mutant was further investigated. The stimulation of PI hydrolysis by carbachol was enhanced in the mutant M1 receptor, and this change was not due to alterations in the rate of receptor desensitization or sequestration. The observed larger response to carbachol at mutant M1 receptors was also not due to an artifact resulting from selection of CHO cells which express higher levels of G-proteins or phospholipase C. Our data suggest that although the LYTTYL sequence in M1 muscarinic receptors is not involved in determining receptor pharmacology, mutation of the sequence enhanced the coupling of M1 receptors to the stimulation of phospholipase C.