The voltage-gated potassium channel Kv1.3 plays a crucial role in the immune system response. In leukocytes, the channel is coexpressed with the dominant negative regulatory subunit KCNE4, which associates with Kv1.3 to trigger intracellular retention and accelerating C-type inactivation of the channel. Previous research has demonstrated that the main association between these proteins occurs through both C-termini. However, these data fail to fully elucidate the KCNE4-dependent modulation of channel kinetics. In the present study, we analyzed the contribution of each KCNE4 domain to the modulation of Kv1.3. Our results further confirmed that the C-terminus of KCNE4 is the main determinant involved in the association-triggered intracellular retention of the channel. Moreover, interactions throughout the transmembrane region were also observed. Both the C-terminus and, especially, the transmembrane domain of KCNE4 accentuated the C-type inactivation of Kv1.3. Our data provide, for the first time, the molecular effects that a KCNE peptide, such as KCNE4, exerts on a Shaker channel, such as Kv1.3. Our results pave the way for understanding the molecular mechanisms underlying potassium channel modulation and suggest that KCNE4 participates in the conformational rearrangement of the Kv1.3 architecture, altering the C-type inactivation of the channel.