The insulin-dependent tyrosine kinase activity (TKA) of the insulin receptor (IR) plays an essential role in insulin signaling. Thus, dysregulation of IR-TKA might be an important element in the states of insulin resistance. A phosphorylated rat hepatic glycoprotein (pp63) acting as an inhibitor of IR-TK has been described. In search of the human homolog of pp63, we isolated a cDNA clone from a human liver lambda gt11 cDNA library. DNA sequence analysis reveals identity with the mRNA product of a human gene AHSG encoding a serum protein, alpha 2-Heremans Scmid-glycoprotein (alpha 2HSG), with heretofore unknown physiological function. Northern blot analysis demonstrates a 1.8-kilobase mRNA in human liver and HepG2 hepatoma cells. alpha 2HSG, purified from human serum, specifically inhibits insulin-stimulated IR autophosphorylation in vitro and in vivo as well as exogenous substrate tyrosine phosphorylation. alpha 2HSG also inhibits both insulin-induced tyrosine phosphorylation of IRS-1 and the association of IRS-1 with the p85 subunit of phosphatidylinositol-3 kinase in H-35 hepatoma cells. alpha 2HSG inhibits insulin-dependent mitogenesis, but does not affect insulin-stimulated induction of the metabolic enzyme tyrosine aminotransferase. alpha 2HSG does not compete with insulin for binding to IR. Finally, the action of alpha 2HSG is specific toward the IR-TK; its effect does not extend to insulin-like growth factor-I-stimulated TKA. Our results allow us to assign a biochemical function for human alpha 2HSG, namely regulation of insulin action at the IR-TK level.