Agonist-induced phosphorylation of G protein-coupled receptors (GPCRs) is a primary determinant of β-arrestin (βarr) recruitment and trafficking. For several GPCRs, such as the vasopressin type II receptor (V2R), which exhibit high affinity for βarrs, agonist-stimulation first drives the translocation of βarrs to the plasma membrane, followed by endosomal trafficking. We previously found that mutation of a single phosphorylation site in V2R (i.e., V2RT360A) results in near-complete loss of βarr translocation to endosomes although βarrs are robustly recruited to the plasma membrane. Here, we show that a synthetic intrabody referred to as intrabody30 (Ib30), which selectively recognizes an active-like βarr1 conformation, rescues endosomal translocation of βarr1 for V2RT360A. In addition, Ib30 also rescues agonist-induced ERK1/2 MAP kinase activation for V2RT360A to levels similar to that of the wild-type V2R. Molecular dynamics simulations reveal that Ib30 binding promotes active-like conformation in βarr1 with respect to the inter-domain rotation. Interestingly, we also observe that Ib30 enhances the interaction of βarr1 with β2-adaptin, which provides a mechanistic basis for the ability of Ib30 to promote endosomal trafficking of βarr1. Taken together, our data provide a novel mechanism to positively modulate the receptor-transducer-effector axis for GPCRs using intrabodies, which can potentially be integrated in the current paradigm of GPCR-targeted drug discovery.