NK cell responses depend on the balance of signals from inhibitory and activating receptors. However, how the integration of antagonistic signals occurs upon NK cell-target cell interaction is not fully understood. Here, we provide evidence that NK cell inhibition via the inhibitory receptor Ly49A is dependent on its relative colocalization at nanometer-scale with the activating receptor NKG2D upon immune synapse (IS) formation. In the presence of their respective cognate ligands, NKG2D and Ly49A colocalize at a nanometer scale leading to NK cell inhibition. However, increasing the size of the Ly49A ligand reduced the nanoscale colocalization with NKG2D consequently impairing Ly49A-mediated inhibition. Our results suggest the balance of NK cell signals, and NK cell responses, are determined by the relative nanoscale colocalization of activating and inhibitory receptors in the immune synapse.