We have identified a 35 amino acid peptide toxin of the inhibitor cysteine knot family that blocks cationic stretch-activated ion channels. The toxin, denoted GsMTx-4, was isolated from the venom of the spider Grammostola spatulata and has <50% homology to other neuroactive peptides. It was isolated by fractionating whole venom using reverse phase HPLC, and then assaying fractions on stretch-activated channels (SACs) in outside-out patches from adult rat astrocytes. Although the channel gating kinetics were different between cell-attached and outside-out patches, the properties associated with the channel pore, such as selectivity for alkali cations, conductance (∼45 pS at −100 mV) and a mild rectification were unaffected by outside-out formation. GsMTx-4 produced a complete block of SACs in outside-out patches and appeared specific since it had no effect on whole-cell voltage-sensitive currents. The equilibrium dissociation constant of ∼630 nM was calculated from the ratio of association and dissociation rate constants. In hypotonically swollen astrocytes, GsMTx-4 produces ∼40% reduction in swelling-activated whole-cell current. Similarly, in isolated ventricular cells from a rabbit dilated cardiomyopathy model, GsMTx-4 produced a near complete block of the volume-sensitive cation-selective current, but did not affect the anion current. In the myopathic heart cells, where the swell-induced current is tonically active, GsMTx-4 also reduced the cell size. This is the first report of a peptide toxin that specifically blocks stretch-activated currents. The toxin affect on swelling-activated whole-cell currents implicates SACs in volume regulation.