Stromal interaction molecule (STIM)-1 and -2 regulate agonist-induced and basal cytosolic calcium (Ca2+) levels after oligomerization and translocation to endoplasmic reticulum (ER)-plasma membrane (PM) junctions. At these junctions, the STIM cytosolic coiled-coil (CC) domains couple to PM Orai1 proteins and gate these Ca2+ release-activated Ca2+ (CRAC) channels, which facilitate store-operated Ca2+ entry (SOCE). Unlike STIM1 and STIM2, which are SOCE activators, the STIM2β splice variant contains an 8-residue insert located within the conserved CCs which inhibits SOCE. It remains unclear if the 2β insert further depotentiates weak STIM2 coupling to Orai1 or independently causes structural perturbations which prevent SOCE. Here, we use far-UV circular dichroism, light scattering, exposed hydrophobicity analysis, solution small angle X-ray scattering, and a chimeric STIM1/STIM2β functional assessment to provide insights into the molecular mechanism by which the 2β insert precludes SOCE activation. We find that the 2β insert reduces the overall α-helicity and enhances the exposed hydrophobicity of the STIM2 CC domains in the absence of a global conformational change. Remarkably, incorporation of the 2β insert into the STIM1 context not only affects the secondary structure and hydrophobicity as observed for STIM2, but also eliminates the more robust SOCE response mediated by STIM1. Collectively, our data show that the 2β insert directly precludes Orai1 channel activation by inducing structural perturbations in the STIM CC region.