The interferon-gamma inducible large GTPase human guanylate binding protein-1 (hGBP-1) plays a key role in anti-pathogenic and anti-proliferative functions. This protein hydrolyzes GTP to both GDP and GMP (predominant product) through sequential phosphate cleavages, which makes it functionally distinct from other GTPases. Previous study on truncated variants of hGBP-1 suggested that the α-helix present in the intermediate region is essential for dimerization and thus for GMP formation. However, the role of this helix in the full-length protein in GMP formation is not clearly understood. Here, we present that substitution of the helix with a Gly-rich flexible (GGS) sequence in the full-length hGBP-1 (termed as linker protein) showed a drastic decrease in GMP formation. Unlike wild-type, the linker protein is not capable of undergoing substrate-induced dimerization and thereby transition state-induced tetramerization, suggesting the importance of the helix in oligomerization. Furthermore, we examined the effect of interactions between this helix and the α2-helix of the globular domain in GMP formation through mutational studies. The L118G mutation in the α2-helix showed a significantly reduced GMP formation. These results indicate that the interactions of the α-helix with the α2-helix are essential for enhanced GMP production. We propose that these interactions help in the oligomerization-assisted proper positioning of the catalytic machinery for efficient second phosphate cleavage. These findings thus provide a better understanding into the regulation of GMP formation in a large GTPase hGBP-1.