The single-pass transmembrane protein Stromal Interaction Molecule 1 (STIM1), located in the endoplasmic reticulum (ER) membrane, possesses two main functions: It senses the ER-Ca ²⁺ concentration and directly binds to the store-operated Ca ²⁺ channel Orai1 for its activation when Ca ²⁺ recedes. At high resting ER-Ca ²⁺ concentration, the ER-luminal STIM1 domain is kept monomeric but undergoes di/multimerization once stores are depleted. Luminal STIM1 multimerization is essential to unleash the STIM C-terminal binding site for Orai1 channels. However, structural basis of the luminal association sites has so far been elusive. Here, we employed molecular dynamics (MD) simulations and identified two essential di/multimerization segments, the α7 and the adjacent region near the α9-helix in the sterile alpha motif (SAM) domain. Based on MD results, we targeted the two STIM1 SAM domains by engineering point mutations. These mutations interfered with higher-order multimerization of ER-luminal fragments in biochemical assays and puncta formation in live-cell experiments upon Ca ²⁺ store depletion. The STIM1 multimerization impeded mutants significantly reduced Ca ²⁺ entry via Orai1, decreasing the Ca ²⁺ oscillation frequency as well as store-operated Ca ²⁺ entry. Combination of the ER-luminal STIM1 multimerization mutations with gain of function mutations and coexpression of Orai1 partially ameliorated functional defects. Our data point to a hydrophobicity-driven binding within the ER-luminal STIM1 multimer that needs to switch between resting monomeric and activated multimeric state. Altogether, these data reveal that interactions between SAM domains of STIM1 monomers are critical for multimerization and activation of the protein.