Scatchard analysis of the binding of EGF to its receptor yields concave up plots that indicate the presence of two classes of binding sites. However, how two independent classes of sites arise from the expression of a single EGF receptor protein has never been adequately explained. Using a new analytical approach involving the simultaneous fitting of binding isotherms from cells expressing increasing levels of EGF receptors, we show that (125)I-EGF-binding data can be completely explained by a model involving negative cooperativity in an aggregating system. This approach provides an experimentally determined value for the monomer-dimer equilibrium constant, which, for wild-type EGF receptors, corresponds to approximately 50,000 receptors per cell. Therefore, changes in receptor expression within the physiological range can modulate the outcome of a signaling stimulus. Analysis of the L680N-EGF receptor mutant, in which the formation of asymmetric kinase domain dimers is blocked, indicates that the kinase dimers make a substantial energetic contribution to the ligand-independent association of EGF receptor monomers, but are not necessary for negative cooperativity. The model accurately predicts the behavior of receptor mutants, such as the dimerization-defective Y246D-EGF receptor, which exhibit a single class of binding sites and provides a framework for understanding secondary dimer formation and lateral signaling in the EGF receptor family.