Hsp90 association with glucocorticoid receptors (GRs) is required for steroid binding. We recently reported that seven amino acids (547-553) overlapping the amino-terminal end of the rat GR ligand-binding domain are necessary for hsp90 binding, and consequently steroid binding. The role of a LXXLL motif at the COOH terminus of this sequence has now been analyzed by determining the properties of Leu to Ser mutations in full-length GR and glutathione S-transferase chimeras. Surprisingly, these mutations decreased steroid binding capacity without altering receptor levels, steroid binding affinity, or hsp90 binding. Single mutations in the context of the full-length receptor did not affect the transcriptional activity but the double mutant (L550S/L553S) was virtually inactive. This biological inactivity was found to be due to an increased rate of steroid dissociation from the activated mutant complex. These results, coupled with those from trypsin digestion studies, suggest a model in which the GR ligand-binding domain is viewed as having a "hinged pocket," with the hinge being in the region of the trypsin digestion site at Arg(651). The pocket would normally be kept shut via the intramolecular interactions of the LXXLL motif at amino acids 550-554 acting as a hydrophobic clasp.