To test the functional consequence of phosphorylation of the EGF receptor at Thr 654 by protein kinase C, the normal Thr 654 human EGF receptor cDNA or a mutant encoding an Ala 654 were expressed in heterologous cells. In cell lines expressing both the Thr 654 and Ala 654 receptors, functional cell-surface Thr 654 receptors were reduced or were totally lost, but were not degraded, following activation of protein kinase C by phorbol esters (TPA), whereas Ala 654 receptors were unaffected. These data suggest that protein kinase C regulates ligand-independent receptor binding and internalization via phosphorylation of Thr 654 of the EGF holoreceptor. Because EGF induces internalization and degradation of the Ala 654 EGF receptor, at least two independent mechanisms can serve to signal loss of functional EGF receptors.