Understanding receptor-ligand interactions, and the signal transduction pathways they activate, is of great interest for the discovery of novel antagonists and agonists. In this report we describe a rapid and efficient procedure to evaluate the importance of several different epidermal growth factor (EGF) residues for the binding and activation of its receptor (EGFR). We constructed an EGF mutant library randomized at positions 13, 15 and 16 and expressed them on filamentous phages. Phage display is a powerful system, allowing rapid isolation of binding mutants. Since many of the most pharmacologically interesting receptors cannot be produced in a soluble form, we developed a technique to rapidly select receptor-binding molecules directly on cells. A luciferase assay, simple to perform, was then used to test their biological transduction activity and to rapidly detect mutants of interest. Analysis of the resulting sequences revealed that the wild-type amino acids at positions 13, 15 and 16 are optimized for binding and activity. EGF mutants with agonist properties were also isolated and tolerated substitutions were identified.