The M 4 muscarinic acetylcholine (ACh) receptor (M 4 mAChR) is enriched in many regions of the forebrain including the striatum. Striatal M 4 mAChRs are preferentially found on a subset of striatal projection neurons that express D1 dopamine receptors and give rise to the so‐called direct striato‐nigral pathway. To study the functional roles of these striatal M 4 mAChRs, we used Cre/loxP technology to generate mutant mice that lack M 4 mAChRs only in D1 receptor‐expressing neurons ('D1‐M4‐KO mice'). Adenylyl cyclase assays with striatal membranes showed that carbachol, a muscarinic agonist, was able to inhibit D1 receptor‐mediated increases in striatal cAMP levels in control mice, but lacked this activity in tissues from D1‐M4‐KO mice. In behavioral studies, D1‐M4‐KO mice showed a significant increase in basal locomotor activity, as compared to control littermates. Furthermore, apomorphine, a non‐selective dopamine receptor agonist, and SKF38393, a D1 receptor selective agonist, induced greater stimulatory locomotor responses in D1‐M4‐KO than in control mice. These studies provide novel insights into the functional roles of striatal M 4 mAChRs and their potential involvement in the pathophysiology of various CNS disorders including Parkinson's disease and schizophrenia.