Cripto-1 (CR-1) is a novel protein that contains a modified EGF-like motif and that does not directly bind to any of the known erb B type-1 receptor tyrosine kinase receptors. To more clearly define the biological effects of CR-1 and to more adequately compare the structure-function relationships of CR-1 with other members of the EGF family of growth factors, we have expressed a modified, full-length recombinant human CR-1 protein (rhCR-1) in E. coli and have devised a procedure for the solubilization, refolding and purification of a biologically active form of this protein. We have generated the mature form of hCR-1 from computer assisted predictions of potential signal peptide cleavage sites. Expression of the modified rhCR-1 protein in E. coli was limited to the inclusion bodies. The rhCR-1 protein was found to be expressed at high levels in bacterial cells when fused to a histidine-tag sequence. Refolding of rhCR-1 was found to be difficult because of the large number of cysteine residues in the protein which results in protein aggregation. By chemically modifying the cysteine residues in the rhCR-1 protein with 3-trimethylammoniopropyl methanethiosulfonate, additional positive charges have been introduced into the protein by this disulfiding reagent. This modification facilitates solubilization of the protein when rhCR-1 is denatured. The solubilized, denatured protein was then purified by CM cation exchange and C4 reverse phase HPLC chromatography and refolded in a redox buffer. The refolded, modified rhCR-1 protein was found to be biologically active by its ability to inhibit beta-casein expression, to stimulate the tyrosine phosphorylation of Shc and the activation of MAPK and by its capacity to facilitate branching growth of mouse mammary epithelial cells in type I collagen gels.