The heregulin/neu differentiation factor gene products were purified and cloned based on their ability to stimulate the phosphorylation of a 185-kDa protein in human breast carcinoma cell lines known to express erbB2. However, not all cells that express erbB2 respond to heregulin, indicating that other components besides erbB2 may be required for heregulin binding. Cells that are transfected with the closely related receptor, erbB3, display a single class of lower affinity heregulin binding sites than has been previously observed on breast carcinoma cell lines. Little or no stimulation of tyrosine phosphorylation in response to heregulin occurs in cells that are transfected with erbB3 alone. Transfection of cells with erbB3 and erbB2 reconstitutes a higher affinity binding receptor, which is also capable of generating a tyrosine phosphorylation signal in response to heregulin. A monoclonal antibody to erbB2 will inhibit heregulin activation of tyrosine phosphorylation and binding in cells transfected with both receptors but not with erbB3 alone. In cells expressing erbB2 and erbB3, both proteins become tyrosine-phosphorylated upon interaction with heregulin. Direct interaction between heregulin and the two proteins was demonstrated by chemical cross-linking experiments using 125I-heregulin followed by immunoprecipitation with antibodies specific for erbB2 or erbB3.