Water-soluble models of ligand-gated ion channels would be advantageous for structural studies. We investigated the suitability of three versions of the N-terminal extracellular domain (ECD) of the alpha7 subunit of the nicotinic acetylcholine receptor (AChR) family for this purpose by examining their ligand-binding and assembly properties. Two versions included the first transmembrane domain and were solubilized with detergent after expression in Xenopus oocytes. The third was truncated before the first transmembrane domain and was soluble without detergent. For all three, their equilibrium binding affinities for alpha-bungarotoxin, nicotine, and acetylcholine, combined with their velocity sedimentation profiles, were consistent with the formation of native-like AChRs. These characteristics imply that the alpha7 ECD can form a water-soluble AChR that is a model of the ECD of the full-length alpha7 AChR.