A number of different membrane associated isoforms of the neural cell adhesion molecule (N-CAM) have previously been identified. Here the structure of a novel secreted isoform of N-CAM is established by analysis of a cDNA corresponding to an N-CAM mRNA from human skeletal muscle. The mRNA incorporates a novel sequence block into the extracellular domain, which introduces an in-frame stop codon and thus prematurely terminates the coding sequence, generating a truncated N-CAM polypeptide. Analysis of genomic clones indicates that the inserted sequence is present as a discrete exon within the human N-CAM gene, and Northern analysis shows it to be associated specifically with a 5.2 kb mRNA species from skeletal muscle and brain. Stable transfectants expressing the secreted isoform accumulate it in the cytoplasm and release it to the culture medium. In contrast, cells transfected with cDNA encoding lipid-tailed N-CAM express it predominantly at the cell surface. The existence of a secreted isoform may further expand the spectrum of N-CAM function beyond its known involvement in intercellular adhesion to extracellular matrix interactions.