Using immobilized PDGF receptor as an affinity reagent, we purified an 85 kd protein (p85) from cell lysates and we cloned its cDNA. The protein contains an SH3 domain and two SH2 domains that are homologous to domains found in several receptor-associated enzymes. Recombinant p85 overexpressed in mammalian cells inhibited the binding of endogenous p85 and a 110 kd protein to the receptor and also blocked the association of PI3-kinase activity with the receptor. Experiments with receptor mutants and with short peptides derived from the kinase insert region of the PDGF receptor showed that the recombinant p85 binds to a well-defined phosphotyrosine-containing sequence of the receptor. p85 appears to be the subunit of PI3-kinase that links the enzyme to the ligand-activated receptor.