The melanocortin 1 receptor (MC1R) is a G-protein-coupled receptor (GPCR) crucial for the regulation of melanocyte proliferation and differentiation. MC1R activation by melanocortin hormones triggers the cAMP pathway and stimulates the extracellular-signal-regulated protein kinases ERK1 and ERK2 to promote synthesis of photoprotective eumelanin pigments, among other effects. Signaling from most GPCRs is regulated by the β-arrestin (ARRB) family of cytosolic multifunctional adaptor proteins, which mediate signal termination and endocytosis of GPCR-agonist complexes. The ubiquitously expressed non-visual β-arrestin1 (ARRB1) and β-arrestin2 (ARRB2) are highly similar but not functionally equivalent. Their role in the regulation of MC1R is unknown. Using a combination of co-immunoprecipitation, gel filtration chromatography, confocal microscopy, siRNA-mediated knockdown and functional assays, we demonstrated agonist-independent competitive interactions of ARRB1 and ARRB2 with MC1R, which might also be independent of phosphorylation of Ser/Thr residues in the C-terminus of the MC1R. The effects of ARRBs were isoform specific; ARRB2 inhibited MC1R agonist-dependent cAMP production but not ERK activation, stimulated internalization and showed prolonged co-localization with the receptor in endocytic vesicles. By contrast, ARRB1 had no effect on internalization or functional coupling, but competed with ARRB2 for binding MC1R, which might increase signaling by displacement of inhibitory ARRB2. These data suggest a new mechanism of MC1R functional regulation based on the relative expression of ARRB isoforms, with possible activatory ARRB1-dependent effects arising from partial relief of inhibitory ARRB2-MC1R interactions. Thus, competitive displacement of inhibitory ARRBs by functionally neutral ARRB isoforms might exert a paradigm-shifting signal-promoting effect to fine-tune signaling downstream of certain GPCRs.