Inwardly rectifying potassium (Kir) channels were the first shown to be directly activated by phosphoinositides in general and phosphatidylinositol bisphosphate (PIP2) in particular. Atomic resolution structures have been determined for several mammalian and bacterial Kir channels. Basic residues, identified through mutagenesis studies to contribute to the sensitivity of the channel to PIP2, have been mapped onto the three dimensional channel structure and their localization has given rise to a plausible model that can explain channel activation by PIP2. Moreover, mapping onto the three-dimensional channel structure sites involved in the modulation of Kir channel activity by a diverse group of regulatory molecules, revealed a striking proximity to residues implicated in phosphoinositide binding. These observations support the hypothesis that the observed dependence of diverse modulators on channel–PIP2 interactions stems from their localization within distances that can affect PIP2-interacting residues.