Ganglioside GM3 inhibits epidermal growth factor (EGF)-dependent cell proliferation in a variety of cell lines. Both in vitro and in vivo, this glycosphingolipid inhibits the kinase activity of the EGF receptor (EGFR). Furthermore, membrane preparations containing EGFR can bind to GM3-coated surfaces. These data suggest that GM3 may interact directly with the EGFR. In this study, the interaction of gangliosides with the extracellular domain (ECD) of the EGFR was investigated. The purified human recombinant ECD from insect cells bound directly to ganglioside GM3. The ganglioside interaction site appears to be distinct from the EGF-binding site. In agreement with previous reports on the effects of specific gangliosides on EGFR kinase activity, the ECD preferentially interacted with GM3. The order of relative binding of other gangliosides investigated was as follows: GM3 GM2, GD3, GM4 > GM1, GD1a, GD1b, GT1b, GD2, GQ1b > lactosylceramide. These data suggest that NeuAc-lactose is essential for binding and that any sugar substitution reduces binding. In agreement with the specificity of soluble ECD binding to gangliosides, GM3 specifically inhibited EGFR autophosphorylation. Identification of a ganglioside interaction site on the ECD of the EGFR is consistent with the hypothesis that endogenous GM3 may function as a direct modulator of EGFR activity.