In responsive cells, all known effects of epidermal growth factor (EGF), transforming growth factor alpha (TGF alpha), and related proteins are mediated through binding to a specific membrane receptor. The EGF/TGF alpha receptor is a single-chain glycoprotein (1186 amino acids) containing three functional domains: 1) an extracellular, glycosylated portion that binds EGF; 2) a small transmembrane portion; and 3) a cytoplasmic portion that has the intrinsic tyrosine kinase activity and multiple sites that can be phosphorylated. When EGF binds to the receptor its intrinsic tyrosine kinase is activated, resulting in increased phosphorylation of intracellular tyrosine residues both on the receptor (autophosphorylation sites) and on exogenous proteins involved in regulating cellular functions. Site-specific mutagenesis has established that the tyrosine-kinase activity of the receptor is essential for nearly all of the effects of EGF including its ability to elevate cellular calcium levels and to induce DNA synthesis. The binding of EGF and the kinase activity of the receptor are both regulated by the phosphorylation of the receptor on specific threonine/serine sites catalyzed by other protein kinases. Specific lipids such as sphingosine also can regulate kinase activity. Tyrosine-specific phosphoprotein phosphatases and perhaps proteases must be important in terminating the cellular response to EGF. In human skin, the response to EGF/TGF alpha is determined by the location and number of receptors and is modulated by processes affecting the binding affinity, internalization, and tyrosine-kinase activity of the receptor. Specific patterns of EGF binding and of immunoreactive receptors characterize normal growth and differentiation and these are altered during the abnormal growth and differentiation associated with diseases such as psoriasis, viral infections, neoplasms, and paraneoplastic syndromes. It is not clear if the altered patterns reflect the consequence of the disease or are the cause of the disease. As a cause, the EGF receptor may have undetected point mutations that result in internalization and degradation defects, aberrant phosphorylation, and dephosphorylation or abnormal glycosylation.