We have exploited the differences in binding affinities of the chicken epidermal growth factor (EGF) receptor for EGF and transforming growth factor alpha (TGF alpha) to study the role of the B-loop beta-sheet of these ligands in receptor recognition and activation. Although EGF and TGF alpha share similar secondary and tertiary structures imposed by three highly conserved intramolecular disulfide bonds, they have only 30-40% overall sequence identity. The B-loop beta-sheet is the major structural element in EGF and TGF alpha, but sequence similarity in this region is low. To investigate its role in receptor binding, we constructed two chimeric growth factors (mEGF/hTGF alpha 21-30 and mEGF/hTGF alpha 21-32) composed of the murine EGF (mEGF) amino acid sequence with residues 21-30 of the B-loop beta-sheet replaced by the equivalent residues of human TGF alpha (hTGF alpha); in chimera mEGF/hTGF alpha 21-32, asparagine 32, which lies at the boundary of the amino and carboxyl domains of mEGF, was also replaced by its hTGF alpha counterpart (valine). In initial studies using unpurified medium, it was found that the recombinant growth factors exhibited differing mitogenic potencies (mEGF/hTGF alpha 21-32 > mEGF/hTGF alpha 21-30 > mEGF) when assayed on chicken fibroblasts, even though they were equivalent in mitogenesis assays using cells expressing the human EGF receptor. After purification, mEGF/hTGF alpha 21-32 was found to be 50 times more potent than mEGF in the chick fibroblast mitogenesis assay and exhibited a 10-fold increase in relative affinity for the chicken EGF receptor; both growth factors still exhibited equivalent mitogenic and receptor binding activity when tested on cells expressing human EGF receptors. We conclude that the B-loop beta-sheet of hTGF alpha is an important determinant of EGF receptor binding affinity and biological activity.