The purified urokinase plasminogen activator receptor (u-PAR) was cleaved into two fragments by mild chymotrypsin treatment. The smaller fragment (apparent Mr 16,000) possessed the ligand-binding capability, as shown by chemical cross-linking analysis. This fragment constituted the NH2-terminal part of the intact receptor, probably including the whole sequence 1-87, and contained N-linked carbohydrate. After detergent phase separation in the Triton X-114 system, the fragment was present in the water phase where its binding activity could be demonstrated in the absence of the rest of the protein. An analysis of internal homology in the amino acid sequence of u-PAR revealed the presence of three repeats of approximately 90 residues each. The ligand-binding fragment corresponds to the first repeat, supporting that this unit is a structurally autonomous domain. Domains homologous with the internal repeats of u-PAR constitute the extracellular part of Ly-6 antigens and of the squid glycoprotein Sgp-2. Like u-PAR, these proteins are attached to the membrane by a glycosyl-phosphatidylinositol anchor. The hydrophilic, ligand-binding u-PAR domain identified in the present study has potential applications in interfering with cell-surface plasmin-mediated proteolysis.