The atrial natriuretic peptide (ANP) hormone is secreted by the heart in response to an increase in blood pressure. ANP exhibits several potent anti-hypertensive actions in the kidney, adrenal gland and vascular system. These actions are induced by hormone binding extracellularly to the ANP receptor, thereby activating its intracellular guanylyl cyclase domain for the production of cyclic GMP. Here we present the crystal structure of the glycosylated dimerized hormone-binding domain of the ANP receptor at 2.0-A resolution. The monomer comprises two interconnected subdomains, each encompassing a central beta-sheet flanked by alpha-helices, and exhibits the type I periplasmic binding protein fold. Dimerization is mediated by the juxtaposition of four parallel helices, arranged two by two, which brings the two protruding carboxy termini into close relative proximity. From affinity labelling and mutagenesis studies, the ANP-binding site maps to the side of the dimer crevice and extends to near the dimer interface. A conserved chloride-binding site is located in the membrane distal domain, and we found that hormone binding is chloride dependent. These studies suggest mechanisms for hormone activation and the allostery of the ANP receptor.