Ecto-phosphorylation is emerging as an important mechanism to regulate cellular ligand interactions and signal transduction. Here we show that extracellular phosphorylation of the cell surface receptor collagen XVII regulates shedding of its ectodomain. Collagen XVII, a member of the novel family of collagenous transmembrane proteins and component of the hemidesmosomes, mediates adhesion of the epidermis to the dermis in the skin. The ectodomain is constitutively shed from the cell surface by metalloproteinases of the ADAM (a disintegrin and metalloproteinase) family, mainly by tumor necrosis factor-alpha converting enzyme (TACE). We used biochemical, mutagenesis, and structural modeling approaches to delineate mechanisms controlling ectodomain cleavage. A standard assay for extracellular phosphorylation, incubation of intact keratinocytes with cell-impermeable [gamma-(32)P]ATP, led to collagen XVII labeling. This was significantly diminished by both broad-spectrum extracellular kinase inhibitor K252b and a specific casein kinase 2 (CK2) inhibitor. Collagen XVII peptides containing a putative CK2 recognition site were phosphorylated by CK2 in vitro, disclosing Ser(542) and Ser(544) in the ectodomain as phosphate group acceptors. Phosphorylation of Ser(544) in vivo and in vitro was confirmed by immunoblotting of epidermis and HaCaT keratinocyte extracts with phosphoepitope-specific antibodies. Functionally, inhibition of CK2 kinase activity or mutation of the phosphorylation acceptor Ser(544) to Ala significantly increased ectodomain shedding, whereas overexpression of CK2alpha inhibited cleavage of collagen XVII. Structural modeling suggested that the phosphorylation of serine residues prevents binding of TACE to its substrate. Thus, extracellular phosphorylation of collagen XVII by ecto-CK2 inhibits its shedding by TACE and represents novel mechanism to regulate adhesion and motility of epithelial cells.