Derivatives of palytoxin have been prepared which are modified on either the hydroxyl terminus or the amino terminus of the molecule. Previously we have shown that palytoxin, a non-12-O-tetradecanoylphorbol-13-acetate-type tumor promoter, can inhibit epidermal growth factor binding in Swiss 3T3 cells through a pathway which is sodium dependent but not calcium or protein kinase C dependent. We used the epidermal growth factor receptor system to determine whether the specific chemical modifications of palytoxin present in these derivatives alter the cellular mechanism of action of the toxin. The dose response and ion dependence of palytoxin, the hydroxyl terminus derivative palytoxin-COOH, and the amino terminus derivatives N-acetylpalytoxin and N-(p-bromobenzoyl)palytoxin were compared with respect to inhibition of epidermal growth factor binding. The potency of palytoxin-COOH was similar to that of palytoxin. By contrast, N-acetylpalytoxin and N-(p-bromobenzoyl)palytoxin were approximately 1/100 as potent as palytoxin in this assay. All three derivatives were at least 100-fold less toxic than palytoxin. Like palytoxin, the activities of palytoxin-COOH, N-acetylpalytoxin and N-(p-bromobenzoyl)palytoxin were dependent upon the presence of extracellular sodium. However, there was a significant difference in the dependence of the derivatives on extracellular calcium. Our results suggest that the hydroxyl terminus is important for determining the calcium dependence of the molecule and the amino terminus is important for determining the biological potency of palytoxin. We conclude that modification of the hydroxyl terminus region is an effective means of reducing the toxicity of palytoxin while retaining the biological effects.