H-Ryk is an atypical receptor tyrosine kinase which differs from other members of this family at a number of conserved residues in the activation and nucleotide binding domains. Using a chimeric receptor approach, we demonstrate that H-Ryk has impaired catalytic activity. Despite the receptor's inability to undergo autophosphorylation or phosphorylate substrates, we demonstrate that ligand stimulation of the chimeric receptor results in activation of the mitogen-activated protein kinase pathway. The ability to transduce signals is abolished by mutation of the invariant lysine (K334A) in subdomain II of H-Ryk. Further, by in vitro mutagenesis, we show that the amino acid substitutions in the activation domain of H-Ryk account for the loss of catalytic activity. In addition to the essential aspartate residue, either phenylalanine or glycine is required in the activation domain to maintain proper conformation of the catalytic domain and thus ensure receptor autophosphorylation. Homology modelling of the catalytic domain of H-Ryk provides a rationale for these findings. Thus, the signalling properties of H-Ryk are divergent from those of other classical receptor tyrosine kinases.