The invention relates to a packet-switched radio system and to a method of locating a subscriber terminal in a packet-switched radio system. In the method (302) the core network of the radio system transmits a location service request message to the radio network of the radio system; (304) the radio network transmits information to a subscriber terminal in a paging message that the subscriber terminal is requested to initiate the location service; (306) the subscriber terminal that received the paging message transmits a paging response message to the radio network; (308) the radio network transmits the paging response message to the core network; (310) the network part locates the subscriber terminal on the basis of the information included in the paging response message.