Arrestins rapidly bind phosphorylated activated forms of their cognate G protein-coupled receptors, thereby preventing G protein coupling and often switching signaling to other pathways. Amphipathic alpha-helix I (residues 100-111) has been implicated in receptor binding, but the mechanism of its action has not been determined yet. Here we show that several mutations in the helix itself and in adjacent hydrophobic residues in the body of the N-domain reduce arrestin1 binding to light-activated phosphorylated rhodopsin (P-Rh*). On the background of phosphorylation-independent mutants that bind with high affinity to both P-Rh* and light-activated unphosphorylated rhodopsin, these mutations reduce the stability of the arrestin complex with P-Rh*, but not with light-activated unphosphorylated rhodopsin. Using site-directed spin labeling, we found that the local structure around alpha-helix I changes upon binding to rhodopsin. However, the intramolecular distances between alpha-helix I and adjacent beta-strand I (or the rest of the N-domain), measured using double electron-electron resonance, do not change, ruling out relocation of the helix due to receptor binding. Collectively, these data demonstrate that alpha-helix I plays an indirect role in receptor binding, likely keeping beta-strand I, which carries several phosphate-binding residues, in a position favorable for its interaction with receptor-attached phosphates.