The stimulatory G protein (Gs) mediates activation of adenylylcyclase (AC). The alpha-subunit (Gs alpha) of heterotrimeric (alpha beta gamma) G/s has a guanine nucleotide-binding site and intrinsic GTPase activity. Activation of AC occurs when an agonist-receptor complex promotes the exchange of GDP for GTP in the nucleotide binding site of Gs alpha. Nucleotide exchange causes dissociation of Gs alpha from the beta gamma- subunit complex (G beta gamma). Gs alpha then activates AC until GTP hydrolysis occurs and G beta gamma reassociates with Gs alpha. This model is widely accepted, and Gs subunit dissociation is a critical part of the model since G beta gamma plays an important regulatory role in the process. However, we have recent experimental evidence to suggest that this model is incorrect. Bovine brain Gs activity was assayed by the ability to reconstitute AC in membranes from Gs alpha-deficient S49 cyc- (minus) cells. Gs subunit dissociation was assayed by immunoprecipitating Gs alpha and determining the amount of G beta that was coprecipitated. Alternately, dissociation was measured by the ability of Gs to serve as a substrate for the bacterial toxin choleragen (CT), which catalyzes the ADP-ribosylation of heterotrimeric Gs, but not free Gs alpha. Magnesium ion caused a concentration-dependent dissociation of Gs in solution, and GDP and GTP were equally effective at inhibiting this effect. Activation of Gs with GTPgammaS, a nonhydrolyzable GTP analog, or with fluoroaluminate at physiological concentrations of magnesium ion, did not cause Gs subunit dissociation. Activation with fluoroaluminate caused Gs to dissociate in the presence but not in the absence of chloride ion. This was explained in earlier reports by others that fluoroaluminate caused Gs dissociation in the presence of low magnesium. Recombinant DNA techniques were used to construct a modified form of the 52 kDa version of Gs alpha which contained a 2.4 kDa peptide attached to the N-terminus (Gs alpha54.4). Gs alpha 54.4 bound GTP gammaS and formed a heterotrimer with G beta gamma in solution. When reconstituted into cyc- membranes, however, Gs alpha 54.4 was unable to form a heterotrimer with G beta gamma or activate AC unless the modifying peptide was removed by proteolysis. These data suggest that activated Gs heterotrimer and not the free Gs alpha-subunit mediates agonist stimulation of AC.