The ErbB3 protein is a member of the ErbB subfamily of receptor protein tyrosine kinases. In the present study, the mechanism by which the ErbB3 protein is phosphorylated and the signal-transducing functions of this phosphorylated protein were investigated. When phosphorylated by the epidermal growth factor receptor in vitro, the ErbB3 protein strongly associated with the regulatory p85 subunit and the catalytic activity of phosphatidylinositol (PI) 3-kinase. The association of PI 3-kinase with ErbB3 in human breast cancer cells was found to be correlated with the constitutive phosphorylation of ErbB3 on tyrosine residues. In MDA-MB-468 breast cancer cells in which the ErbB3 protein is not constitutively phosphorylated, stimulation with epidermal growth factor led to the phosphorylation of ErbB3 on tyrosine residues and the formation of a functional signal transduction complex involving the ErbB3 protein and PI 3-kinase. These results suggest that the ErbB3 protein can be phosphorylated on tyrosine residues by a cross-phosphorylation mechanism and that the phosphorylated ErbB3 protein can couple other growth factor receptor protein tyrosine kinases to the PI 3-kinase pathway in a manner similar to the insulin receptor substrate 1 protein.