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There is considerable interest in developing antibodies as functional modulators of G protein-coupled receptor (GPCR) signaling for both therapeutic and research applications. However, there are few antibody ligands targeting GPCRs outside of the chemokine receptor group. GPCRs are challenging targets for conventional antibody discovery methods, as many are highly conserved across species, are biochemically unstable upon purification, and possess deeply buried ligand-binding sites. Here, we describe a selection methodology to enrich for functionally modulatory antibodies using a yeast-displayed library of synthetic camelid antibody fragments called “nanobodies.” Using this platform, we discovered multiple nanobodies that act as antagonists of the angiotensin II type 1 receptor (AT1R). Following angiotensin II infusion in mice, we found that an affinity matured nanobody antagonist has comparable antihypertensive activity to the angiotensin receptor blocker (ARB) losartan. The unique pharmacology and restricted biodistribution of nanobody antagonists may provide a path for treating hypertensive disorders when small-molecule drugs targeting the AT1R are contraindicated, for example, in pregnancy.