Immune inhibitory receptor involved in self-nonself discrimination. In complex with KLRD1 on cytotoxic and regulatory lymphocyte subsets, recognizes non-classical major histocompatibility (MHC) class Ib molecule MHC-E loaded with self-peptides derived from the signal sequence of classical MHC class Ia molecules. Enables cytotoxic cells to monitor the expression of MHC class I molecules in healthy cells and to tolerate self. Upon MHC-E-peptide binding, transmits intracellular signals through two immunoreceptor tyrosine-based inhibition motifs (ITIMs) by recruiting INPP5D/SHP-1 and INPPL1/SHP-2 tyrosine phosphatases to ITIMs, and ultimately opposing signals transmitted by activating receptors through dephosphorylation of proximal signaling molecules. Key inhibitory receptor on natural killer (NK) cells that regulates their activation and effector functions. Dominantly counteracts T cell receptor signaling on a subset of memory/effector CD8-positive T cells as part of an antigen-driven response to avoid autoimmunity. On intraepithelial CD8-positive gamma-delta regulatory T cells triggers TGFB1 secretion, which in turn limits the cytotoxic programming of intraepithelial CD8-positive alpha-beta T cells, distinguishing harmless from pathogenic antigens. In MHC-E-rich tumor microenvironment, acts as an immune inhibitory checkpoint and may contribute to progressive loss of effector functions of NK cells and tumor-specific T cells, a state known as cell exhaustion. Heterodimer with KLRD1; disulfide-linked. KLRD1-KLRC1 heterodimer interacts with peptide-bound MHC-E-B2M heterotrimeric complex. Competes with KLRC2 for its interaction with MHC-E. Interacts (via ITIM) with INPP5D/SHIP-1 and INPPL1/SHIP-2 (via SH2 domain). Natural killer cells. The cytosolic N-terminus contains two immunoreceptor tyrosine-based inhibitory motifs (ITIMs), which are essential for the association with INPP5D/SHIP-1 and INPPL1/SHIP-2 phosphatases and functional inhibition. Phosphorylated.