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Xmrk encodes a putative transmembrane glycoprotein of the tyrosine kinase family and is a melanoma-inducing gene in Xiphophorus. We attempted to investigate the biological function of the putative Xmrk receptor by characterizing its signalling properties. Since a potential Iigand for Xmrk has not yet been identified, it has been difficult to analyse the biochemical properlies and biological function of this cell surface protein. In an approach towards such analyses, the Xmrk extracellular domain was replaced by the closely related Iigand-binding domain sequences of the human epidennal growth factor receptor (HER) and the ligand-induced activity of the chimeric HER-Xmrk proteinwas examined. We show that the Xmrk protein is a functional receptor tyrosine kinase, is highly active in malignant melanoma and displays a constitutive autophosphorylation activity possibly due to an activating mutation in its extracellular or transmembrane domain. In the focus formation assay the HER-Xmrk chimera is a potent transfonning protein equivalent to other tyrosine kinase oncoproteins.