Bispecific antibody (BsAb) technology has been successfully used as a means to construct novel antibody (Ab) molecules with increased avidity for binding, by combining two Ab or their fragments directed against different epitopes within the same antigen. Using two single chain antibodies (scFv) isolated from a phage display library, we have constructed a bispecific diabody directed against two different epitopes on the extracellular domain (ECD) of human vascular endothelial growth factor receptor 2 (VEGFR2), the kinase-insert domain-containing receptor (KDR). Neither of the parent scFv blocks KDR/VEGF interactions or inhibits VEGF-induced receptor activation. The diabody binds to KDR with an affinity that is 1.5- to 3-fold higher than its parent scFv, mainly due to a much slower dissociation rate (k(off)), which is approximately 17- to 26-fold slower than that of the individual scFv. In addition, the diabody binds simultaneously to, and thus cross-links, the two epitopes on the receptor(s). It is rather unexpected that the diabody effectively blocked KDR/VEGF interactions, and inhibited both VEGF-induced activation of the receptor and mitogenesis of human endothelial cells. Taken together, our results suggest that the diabody is most likely to exert its effect through steric hindrance and/or causing major conformational changes of the receptor. This is the first report on the construction of a bispecific diabody with acquired novel antagonistic activity.