Alternate splicing of a single exon encoding an NH2-terminal immunoglobulin (Ig) disulfide loop in the ectodomain of the fibroblast growth factor receptor (FGFR) types 1 and 2 results in alpha and beta isoforms that exhibit 3- and 2-Ig loops, respectively. Previously we demonstrated that alternately spliced Loop I has no independent ligand binding activity but is sufficiently interactive with the ligand- and heparin-binding site formed by Loops II and III to lower affinity for the same fibroblast growth factor (FGF) ligand. Here we show that a lower affinity of FGFR1 alpha for heparin parallels the lower affinity for FGF-1. A mutant of FGFR1 alpha in which the sequence between Loops I and II was deleted exhibits high affinity for both FGF-1 and heparin and other properties of the FGFR1 beta isoform, which include resistance to degradation by trypsin and display of specific antibody epitopes. This suggests that the interloop sequence facilitates the interaction of Loop I with Loops II and III. Lack of expression of both exons coding for Loop I and the sequence between Loops I and II in the FGFR2 gene characterizes rat prostate tumor cells, which exhibit a loss of the low affinity class of FGF receptors. Although the exon coding for the sequence between Loops I and II is alternately spliced in the FGFR2 beta isoform, coordinate expression with the exon coding for Loop I results in the functional differences between the FGFR alpha and FGFR beta variants.