Notch signaling is required for the development of almost all animal tissues. It is a cell surface receptor that generates intracellular signals in response to Delta binding its extracellular domain. Notch response to Delta is affected by mutations in its extracellular domain outside of the Delta binding region. One such region is the Notch amino terminus. Mutations in this region are associated with developmental defects. How a mutation in the Notch amino terminus affects Notch function is unknown. We explored this issue in Drosophila melanogaster. We report that Notch receptors mutated in the amino terminus accumulate to abnormal levels, are deficient in Delta induced receptor clustering, and exhibit reduced rate of internalization and signaling. Notch receptors lacking the whole or the carboxy-terminal half of the intracellular domain are defective in internalization but not in clustering or accumulation. None of the other mutated Notch receptors showed defects in clustering, accumulation, or internalization. These observations suggest that the Notch amino terminus regulates Notch levels and clustering, which could affect the rate of Notch signaling and down-regulation.