The thyrotrophin (TSH) receptor (TSHR) is synthesized as a single polypeptide with a predicted large extracellular domain (ECD), a seven-transmembrane pass region and a C-terminal intracellular tail. It is a common target for production of autoantibodies. To investigate whether the ECD is solely responsible for ligand interaction, we directed the expression of this domain in isolation on the cell surface by means of a glycosylphosphatidylinositol (GPI) anchor sequence. Immunoblotting detected TSHR material of Mr 70,000 expressed at high levels. In immunoprecipitation studies, the GPI-anchored ECD was recognized by experimental and pathological antibodies. The molecule was detected on the cell surface by flow cytofluorimetry at up to 10-fold higher amounts than the highest expressing full-length receptor clone. Radioligand binding studies confirmed this and showed that the recombinant molecule bound TSH with high affinity similar to full-length receptor; however, studies with human autoimmune sera indicated differences in the degree of inhibition when compared with full-length receptor. The existence of the GPI anchor was confirmed by cleavage with a GPI-specific phospholipase C and biosynthetic labeling with [3H]ethanolamine. TSHR material was also present inside the cell in both soluble and membrane-bound forms. Thus, the recombinant GPI-anchored ECD is the smallest known fragment of the TSHR that retains high-affinity TSH binding and is expressed at high levels on the cell surface as well as internally; this approach may well be useful for other membrane proteins.