Hyperpolarization-activated, cyclic nucleotide sensitive (HCN) channels underlie the pacemaker current I_f, which plays an essential role in spontaneous cardiac activity. HCN channel subunits (HCN1-4) are believed to be modulated by additional regulatory proteins, which still have to be identified. Using biochemistry, molecularbiology and electrophysiology methods we demonstrate a protein-protein interaction between HCN2 and the K⁺ channel regulator protein 1, named KCR1. In coimmunoprecipitation experiments we show that KCR1 and HCN2 proteins are able to associate. Heterologously expressed HCN2 whole-cell current density was significantly decreased by KCR1. KCR1 profoundly suppressed I_HCN2 single-channel activity, indicating a functional interaction between KCR1 and the HCN2 channel subunit. Endogenous KCR1 expression could be detected in adult and neonatal rat ventriculocytes. Adenoviral-mediated overexpression of KCR1 in rat cardiomyocytes (i) reduced I_f whole-cell currents, (ii) suppressed most single-channel gating parameters, (iii) altered the activation kinetics, (iv) suppressed spontaneous action potential activity, and (v) the beating rate. More importantly, siRNA-based knock-down of endogenous KCR1 increased the native I_f current size and single-channel activity and accelerated spontaneous beating rate, supporting an inhibitory action of endogenous KCR1 on native I_f. Our observations demonstrate for the first time that KCR1 modulates I_HCN2/I_f channel gating and indicate that KCR1 serves as a regulator of cardiac automaticity.