The agonist binding sensitivity and desensitization kinetics of nicotinic acetylcholine receptors (nAChRs) can be modulated by snake venom neurotoxins and related endogenous small proteins of the uPAR-Ly6 family. Here we identify Lypd6, a distantly related member of the u-PAR/Ly-6 family expressed in neurons as a novel modulator of nAChRs. Lypd6 overexpressed in trigeminal ganglia neurons selectively enhanced the Ca2+-component of nicotine-evoked currents through nAChRs, as evidenced by comparative whole-cell patch clamp recordings and Ca2+-imaging in wildtype and transgenic mice overexpressing Lypd6. In contrast, a knockdown of Lypd6 expression using siRNAs selectively reduced nicotine-evoked Ca2+-currents. Pharmacological experiments revealed that the nAChRs involved in this process are heteromers. Transgenic mice displayed behaviors that were indicative of an enhanced cholinergic tone, such as a higher locomotor arousal, increased prepulse-inhibition and hypoalgesia. These mice overexpressing Lypd6 mice were also more sensitive to the analgesic effects of nicotine. Transgenic mice expressing siRNAs directed against Lypd6 were unable to procreate, thus indicating a vital role for this protein. Taken together, Lypd6 seems to constitute a novel modulator of nAChRs that affects receptor function by selectively increasing Ca2+-influx through this ion channels.