Natural killer (NK) cells are capable of directly recognizing pathogens, pathogen-infected cells, and transformed cells. NK cells recognize target cells using approximately 100 germ-line encoded receptors, which display activating or inhibitory function. NK cell activation usually requires the engagement of more than one receptor, and these may contribute distinct signaling inputs that are required for the firm adhesion of NK cells to target cells, polarization, and the release of cytotoxic granules, as well as the production of cytokines. In this article we discuss receptor-mediated mechanisms that counteract NK cell activation. The distinct intracellular inhibitory signaling pathways and how they can dominantly interfere with NK cell activation signaling events are discussed first. In addition, mechanisms by which inhibitory receptors modulate cellular activation at the level of receptor-ligand interactions are described. Receptor-mediated inhibition of NK cell function serves three main purposes: ensuring tolerance of NK cells to normal cells, enabling NK cell responses to aberrant host cells that have lost an inhibitory ligand, and, finally, allowing the recognition of certain pathogens that do not express inhibitory ligands.