torso encodes a receptor tyrosine kinase (torso) required for anterior and posterior terminal development of the Drosophila embryo. Injecting eggs with in vitro synthesized torso mRNAs revealed that torso activation is governed by an extracellular molecule, presumably the torso ligand, produced at terminal regions of the egg during early embryogenesis. In the absence of torso, the ligand shows no apparent localization, indicating that it is diffusible and normally bound by an excess of torso receptor at the egg poles. Mutant ligand-binding torso proteins can suppress telson formation in a dominant negative manner, suggesting that the ligand is limited in amount. Analysis of torso mutations indicates that torso functions as a tyrosine kinase and that gain-of-function mutations causing ligand-independent activation are located in the extracellular domain.