The terminal development of erythroid progenitor cells is promoted in part through the interaction of erythropoietin (EPO) with its cell surface receptor. This receptor and a growing family of related cytokine receptors share homologous extracellular features, including a well-conserved WSXWS motif. To explore the functional significance of this motif in the murine EPO receptor, five WSAWSE mutants were prepared and their signal-transducing, ligand binding, and endocytotic properties were compared. EPO receptors mutated at tryptophan residues (W-232, W-235→G; W-235→G; W-235→F) failed to mediate EPO-induced growth or pp100 phosphorylation, while S-236→T and E-237→K mutants exhibited partial to full activity (50 to 100% of wild-type growth and induced phosphorylation). Ligand affinity was reduced for mutant receptors (two- to fivefold), yet expression at the cell surface for all receptors was nearly equivalent. Also, the ability of mutated receptors to internalize ligand was either markedly reduced or abolished (W-235→F), indicating a role for the WSAWSE region in hormone internalization. Interestingly, receptor forms lacking 97% of the cytosolic domain (no signal-transducing capacity; binding affinity reduced two- to threefold) internalized EPO efficiently. This and all WSAWSE receptor forms studied also mediated specific cross-linking of ¹²⁵I-EPO to three accessory membrane proteins (M_rs, 120,000, 105,000, and 93,000). These findings suggest that the WSAWSE domain of the EPO receptor is important for EPO-induced signal transduction and ligand internalization. In contrast, although the cytosolic domain is required for growth signaling, it appears nonessential for efficient endocytosis.