Inflation is one of the most frequently observed macroeconomic problems, especially in developing economies. However, recently, due to global events such as the Covid-19 pandemic, related lockdowns, supply chain issues, and the Russia-Ukraine war, as well as the expansionary monetary and fiscal policies implemented in response to these events, the world has been experiencing the highest inflation rates of the last half-century. This situation has attracted the attention of both academics and policy makers, but the relationship between the two variables has not yet been releaved in the studies.  Moreover, most studies have generally overlooked the possibility that the effect of government expenditures on inflation might not be linear. Therefore, in this study, it is aimed to investigate the relationship between goverment expenditures and inflation in G7 countries by using the panel threshold value method developed by Hansen (1999) considering these gaps in the literature. Empirical results indicate that the relationship between government expenditures and inflation in G7 countries is non-linear and provide strong evidence for a threshold value for government expenditures. According to these results, an increase in government expenditures below the threshold value (1.344) positively affects inflation, while an increase above this value negatively affects inflation in G7 countries. Additionally, panel causality results show a feedback connection between government expenditures and inflation in the examined group of countries. These findings suggest that policymakers in G7 countries can use government expenditures in coordination with monetary policy tools to achieve price stability.