The protooncogene c-kit encodes a tyrosine kinase receptor for the stem cell factor (SCF). Mutants of c-kit were shown to confer a pleiotropic defective phenotype and often display negative dominance in heterozygous mice. To explore the involvement of receptor dimerization in this genetic phenomenon, we employed both a human ligand, which does not recognize the murine receptor, and a rodent SCF, which binds to the human receptor with 100-fold reduced affinity as compared with human SCF. SCF binding to living cells was found to induce rapid and complete receptor dimerization that involved activation of the catalytic tyrosine kinase function. Although receptor dimerization can be attributed to the dimeric nature of the ligand, no dissociation of Kit dimers occurred at high excess of SCF, suggesting that receptor-receptor interactions are also involved in dimer stabilization. This was supported by in vitro formation of heterodimers between the human and murine Kit proteins through monovalent binding of species-specific human SCF. By coexpression of human and mouse Kit in murine fibroblasts, we found that receptor heterodimerization in living cells involved an increase in the affinity of human Kit for rat SCF and also an accelerated rate of receptor down-regulation. When a human Kit mutant lacking the kinase insert domain was coexpressed with the murine wild-type receptor, we observed a significant decrease in both the activation of the intact tyrosine kinase and its coupling to an effector protein, namely phosphatidylinositol 3'-kinase. Our results favor a receptor activation model that assumes an initial step of monovalent ligand binding, followed by an intermediate receptor dimer bound by one arm of the ligand molecule. This model predicts the existence of an intrinsic receptor dimerization site and provides a structural basis for genetic dominance of mutant SCF receptors.