We isolated a cDNA encoding a functional human thrombin receptor by direct expression cloning in Xenopus oocytes. mRNA encoding this receptor was detected in human platelets and vascular endothelial cells. The deduced amino acid sequence revealed a new member of the seven transmembrane domain receptor family with a large amino-terminal extracellular extension containing a remarkable feature. A putative thrombin cleavage site (LDPR/S) resembling the activation cleavage site in the zymogen protein C (LDPR/I) was noted 41 amino acids carboxyl to the receptor's start methionine. A peptide mimicking the new amino terminus created by cleavage at R41 was a potent agonist for both thrombin receptor activation and platelet activation. "Uncleavable" mutant thrombin receptors failed to respond to thrombin but were responsive to the new amino-terminal peptide. These data reveal a novel signaling mechanism in which thrombin cleaves its receptor's amino-terminal extension to create a new receptor amino terminus that functions as a tethered ligand and activates the receptor.