Ire1 is a type I transmembrane protein located on the endoplasmic reticulum (ER). Upon ER stress, Ire1 releases the ER chaperone BiP and self-associates. This activates Ire1 and triggers the unfolded protein response in the yeast Saccharomyces cerevisiae. We isolated and characterized an Ire1 luminal domain mutant lacking both the N-terminal and the juxtamembrane loosely folded subregions. Although this 'core' mutant was able to self-associate and failed to bind BiP even under nonstressed conditions, its activation was still dependent on ER stress. Furthermore, although substitution of Pro for Ser103 (S103P) in the luminal domain of full-length Ire1 caused neither BiP dissociation nor a change in self-association, the substitution in combination with the core mutation resulted in constitutive activation. This phenotype of the S103P mutation required a cluster of positively charged amino acid residues (Arg or Lys) located close to the mutation site in the Ire1 sequence. These observations indicate that in addition to BiP dissociation and self-association of Ire1, another unknown change on the luminal side is crucial for Ire1 activation.