Members of the seven-transmembrane receptor (7TMR) superfamily are sequestered from the plasma membrane following stimulation both to limit cellular responses as well as to initiate novel G protein-independent signaling pathways. The best studied mechanism for 7TMR internalization is via clathrin-coated pits, where clathrin and adaptor protein complex 2 nucleate and polymerize upon encountering the membrane phospholipid phosphatidylinositol 4,5-bisphosphate (PIP(2)) to form the outer layer of the clathrin-coated vesicle. Activated receptors are recruited to clathrin-coated pits by beta-arrestins, scaffolding proteins that interact with agonist-occupied 7TMRs as well as adaptor protein complex 2 and clathrin. We report here that following stimulation of the beta2-adrenergic receptor (beta2-AR), a prototypical 7TMR, beta-arrestins bind phosphatidylinositol 4-phosphate 5-kinase (PIP5K) Ialpha, a PIP(2)-producing enzyme. Furthermore, beta-arrestin2 is required to form a complex with PIP5K Ialpha and agonist-occupied beta2-AR, and beta-arrestins synergize with the kinase to produce PIP(2) in response to isoproterenol stimulation. Interestingly, beta-arrestins themselves bind PIP(2), and a beta-arrestin mutant deficient in PIP(2) binding no longer internalizes 7TMRs, fails to interact with PIP5K Ialpha, and is not associated with PIP kinase activity assayed in vitro. However, a chimeric protein in which the core kinase domain of PIP5K Ialpha has been fused to the same beta-arrestin mutant rescues internalization of beta2-ARs. Collectively, these data support a model in which beta-arrestins direct the localization of PIP5K Ialpha and PIP(2) production to agonist-activated 7TMRs, thereby regulating receptor internalization.