The ability of insulin to activate the insulin receptor protein kinase is shown to be completely dependent on prior beta subunit tyrosine autophosphorylation. Autophosphorylation in the presence of insulin is a highly concerted reaction; tryptic digestion of insulin receptor beta subunits derived from preparations whose kinase activation ranges from under 5% to 100% of maximal yields the same array of [32P]Tyr(P)-containing peptides over the entire range. Of special note is the significant contribution of multiply phosphorylated forms of tryptic peptides corresponding to proreceptor residues 1144-1152 (from the "tyrosine kinase" domain) and 1314-1329 (near the carboxyl terminus) to overall beta subunit phosphorylation at kinase activations of 5% and under. Thus, partially activated/autophosphorylated receptor preparations consist of mixtures of unactivated unphosphorylated receptors and activated fully (or nearly fully) phosphorylated receptors. The latter can be selectively removed by adsorption to antiphosphotyrosine antibodies. This abrupt multiple phosphorylation of individual receptor molecules explains why, in the presence of insulin, overall beta subunit tyrosine phosphorylation tracks closely with kinase, up to approximately 90% activation. Insulin stimulates phosphorylation into all domains (involving at least 6 of the 13 tyrosines on the intracellular portion of the beta subunit) but does not cause the appearance of "new" 32P-labeled species. Rather, insulin directs 32P incorporation preferentially into those domains most productive of kinase activation. Phosphorylation of the tyrosine residues at 1146, 1150, and 1151 correlates most closely with kinase activation. These residues show the largest 32P incorporation during rapid kinase activation; moreover, in comparisons of receptors with similar overall autophosphorylation but very different activations (or similar activations but different extents of autophosphorylation), achieved by omitting insulin or varying [ATP], the phosphorylation of peptide 1144-1152 tracks closely with kinase activation, and phosphorylation of sites and Mr 4000-5000 tryptic peptide (presumably Tyr 953 and/or 960) tract nearly as well. By contrast the extent of phosphorylation of the carboxy-terminal peptide is frequently dissociated from the extent of kinase activation. Phosphorylation of this latter domain probably underlies a beta subunit function other than tyrosine kinase activity.