The binding of cGMP to the noncatalytic sites on two isoforms of the phosphodiesterase (PDE) from mammalian rod outer segments has been characterized to evaluate their role in regulating PDE during phototransduction. Nonactivated, membrane-associated PDE (PDE-M, alpha beta gamma2) has one exchangeable site for cGMP binding; endogenous cGMP remains nonexchangeable at the second site. Non-activated, soluble PDE (PDE-S, alpha beta gamma2 delta) can release and bind cGMP at both noncatalytic sites; the delta subunit is likely responsible for this difference in cGMP exchange rates. Removal of the delta and/or gamma subunits yields a catalytic alphabeta dimer with identical catalytic and binding properties for both PDE-M and PDE-S as follows: high affinity cGMP binding is abolished at one site (KD >1 microM); cGMP binding affinity at the second site (KD approximately 60 nM) is reduced 3-4-fold compared with the nonactivated enzyme; the kinetics of cGMP exchange to activated PDE-M and PDE-S are accelerated to similar extents. The properties of nonactivated PDE can be restored upon addition of gamma subunit. Occupancy of the noncatalytic sites by cGMP may modulate the interaction of the gamma subunit with the alphabeta dimer and thereby regulate cytoplasmic cGMP concentration and the lifetime of activated PDE during visual transduction in photoreceptor cells.