We have identified a splice variant encoding only the extracellular ligand-binding domain of the gamma-aminobutyric acid B (GABA(B)) receptor subunit GABA(B(1a)). This isoform, which we have named GABA(B(1e)), is detected in both rats and humans. While GABA(B(1e)) is a minor component of the total pool of GABA(B(1)) transcripts detected in the central nervous system, it is the primary isoform found in all peripheral tissues examined. When expressed in a heterologous system, the truncated receptor is both secreted and membrane associated. However, GABA(B(1e)) lacks the ability to bind the radiolabeled antagonist [(3)H]CGP 54626A, activate G-protein coupled inwardly rectifying potassium channels, or inhibit forskolin-induced cAMP production when it is expressed alone or together with GABA(B(2)). Interestingly, when co-expressed with GABA(B(2)), not only does the truncated receptor heterodimerize with GABA(B(2)), the association is of sufficient avidity to disrupt the normal GABA(B(1a))/GABA(B(2)) association. Despite this strong interaction, GABA(B(1e)) fails to disrupt G-protein coupled inwardly rectifying potassium activation by the full-length heterodimer pair of GABA(B(1a))/GABA(B(2)).