The neuropeptide substance P acts, at micromolar concentrations, as a noncompetitive antagonist of nicotinic acetylcholine receptors (AChRs) of both neuronal and muscle subtypes. The mechanism of this inhibition has been shown to be most consistent with stabilization of a nonconducting desensitized state of the AChR, via binding to a site distinct from both the agonist site and the high affinity noncompetitive antagonist site. We have used a radioiodinated photoreactive analogue of substance P, containing the amino acid p-benzoyl-L-phenylalanine in place of the Phe8 residue of substance P, to identify the sites of interaction of substance P within the Torpedo california AChR. AChR-rich membrane suspensions were photolabeled in the absence or presence of the agonist carbamylcholine and/or nonradioactive substance P, and incorporation into AChR subunits was assessed by autoradiography after sodium dodecyl sulfate-polyacrylamide gel electrophoresis. In the absence of agonist 125I incorporation was detected in each subunit and was insensitive to substance P, whereas in the presence of carbamylcholine there was a 2-fold increase in photoincorporation into the AChR delta subunit that was inhibited by the addition of an excess of substance P. The sites of specific photoincorporation in the delta subunit were initially mapped by use of Staphylococcus aureus V8 protease to a 14-kDa fragment extending from delta Ile-192 to Glu-280. Further fragmentation of this 14-kDa fragment with trypsin and S. aureus V8 protease established that the sites of specific incorporation were restricted to the region delta Ser-253 to Glu-280, which contains the membrane-spanning region 2 that is known to form the lining of the ion channel. These results establish that in the presence of agonist at least a part of the undecapeptide substance P binds within the ion channel in the desensitized state of the AChR, and it is likely that the binding of substance P to this site is responsible for the action of substance P as a noncompetitive AChR antagonist.