The trkC locus encodes several receptors for neurotrophin-3, including the well studied full-length tyrosine kinase isoform, in addition to receptor isoforms lacking the kinase active domain. TrkC receptors are widely expressed throughout mouse development in many different organs. To investigate the function of truncated receptors in vivo and to identify cell types that are biologically responsive to this gene product, we have overexpressed a physiological truncated trkC isoform in the mouse. Mice overexpressing this receptor develop to term but die in the first postnatal days. High levels of transgene expression result in severe developmental defects in the peripheral nervous system and in the heart. The severity of neuronal losses observed in these animals suggests that truncated receptors may act by sequestering neurotrophin, thus, closely relating this mouse model to the neurotrophin-3-deficient one. Lower levels of exogenous truncated receptor in transgenic mice result in a more modest phenotype and, in some neuronal populations, do not cause neural deficits. Taken together, these data suggest that truncated trkC receptor isoforms may have modulatory functions in development.