The Eph family of receptor tyrosine kinases and their membrane-bound ligands, the ephrins, are thought to play a role in the regulation of cell adhesion and migration during development by mediating cell-to-cell signalling events. The transmembrane ephrinB protein is a bidirectional signalling molecule that sends a forward signal through the activation of its cognate receptor tyrosine kinase residing on another cell. The reverse signal is transduced into the ephrinB-expressing cell via tyrosine phosphorylation of its conserved C-terminal cytoplasmic domain. Previous work from our laboratory has implicated the activated FGFR1 (fibroblast growth factor receptor 1) as a regulator of a de-adhesion signal that results from overexpression of ephrinB1. In the present study, we report the isolation of Xenopus Grb4 (growth-factor-receptor-bound protein 4), an ephrinB1-interacting protein, and we show that when expressed in Xenopus oocytes, ephrinB1 interacts with Grb4 in the presence of an activated FGFR1. Amino acid substitutions were generated in Grb4, and the resulting mutants were expressed along with ephrinB1 and an activated FGFR in Xenopus oocytes. Co-immunoprecipitation analysis shows that the FLVR motif within the Src homology 2 domain of Xenopus Grb4 is vital for this phosphorylation-dependent interaction with ephrinB1. More importantly, using deletion and substitution analysis we identify the tyrosine residue at position 298 of ephrinB1 as being required for the physical interaction with Grb4, whereas Tyr-305 and Tyr-310 are dispensable. Moreover, we show that the region between amino acids 301 and 304 of ephrinB1 is also required for this critical tyrosine-phosphorylation-dependent event.