The killer cell lectin-like receptor G1 (KLRG1) is an inhibitory receptor expressed by memory T cells and NK cells in man and mice. It is frequently used as a cell differentiation marker and members of the cadherin family are ligands for KLRG1. The present study provides new insights into the interaction of mouse KLRG1 with E-cadherin. Firstly, we demonstrate that co-engagement of KLRG1 and CD3/TCR in a spatially linked manner was required for inhibition arguing against the notion that KLRG1-ligation per se transmits inhibitory signals. Secondly, experiments with T cells carrying Y(7)F-mutant KLRG1 molecules with a replacement of the tyrosine residue to phenylalanine in the single ITIM indicated that the inhibitory activity of KLRG1 is counteracted to some degree by increased interaction of KLRG1(+) T cells with E-cadherin expressing target cells. Thirdly, we demonstrate that deletion of the first or the second external domain of E-cadherin abolished reactivity in KLRG1-reporter cell assays. Finally, we made the intriguing observation that KLRG1 formed multimeric protein complexes in T cells in addition to the previously described mono- and dimeric molecules.