The photoreceptor G-protein, transducin, belongs to the class of heterotrimeric GTP-binding proteins that transfer information from activated seven-span membrane receptors to effector enzymes or ion channels. Like other G-proteins, transducin acts as a molecular clock. It is activated by photoexcited rhodopsin which catalyzes the exchange of transducin-bound GDP for GTP and then stays active until bound GTP is hydrolyzed by an intrinsic GTPase activity. Our previous study on the components of the amphibian phototransduction cascade (Arshavsky, V. Y., and Bownds, M. D. (1992) Nature 357, 416-417) has shown that transducin GTPase can be significantly accelerated by the target enzyme, cGMP phosphodiesterase (PDE), and more specifically its gamma-subunit (PDE gamma). Here we report that an analogous mechanism is present in bovine photoreceptors. Addition of recombinant PDE gamma to the test photoreceptor membranes which retain transducin but are depleted of endogenous PDE causes a significant acceleration of transducin GTPase activity. A similar effect was observed with the PDE holoenzyme, but not with the complex of PDE alpha- and beta-subunits prepared by a limited proteolysis of PDE with trypsin. The activating effect of PDE gamma is increased as test membrane concentration increases, exceeding 20-fold at rhodopsin concentrations over 80 microM and approaching the rate of the photoresponse turnoff. This suggests either that photoreceptor membranes contain a further factor which is essential for PDE-dependent regulation of transducin-bound GTP hydrolysis or that components of the phototransduction cascade interact in a cooperative manner. We also report that the GTPase-activating epitope is located within the C-terminal third of PDE gamma: the peptide corresponding to the 25 C-terminal amino acid residues of PDE gamma can accelerate transducin GTPase almost as well as the full-length PDE gamma. A part of the GTPase activating epitope is located within the 3 C-terminal amino acid residues: the truncation PDE gamma mutant lacking these residues accelerates transducin GTPase considerably less than the whole length PDE gamma.