Binding of insulin to the alpha subunit of the insulin receptor (IR) leads to autophosphorylation of the beta subunit. The reaction proceeds as intramolecular transphosphorylation between alpha beta half-receptors of the heterotetrameric receptor dimer (alpha 2 beta 2). Since IRs are mobile in the plane of the plasma membrane, it is also possible that transphosphorylation may occur between adjacent holoreceptors (alpha 2 beta 2) by an intermolecular reaction. To address this question, we cotransfected NIH-3T3 cells with two IR cDNA constructs: a truncated but functionally normal IR lacking the C-terminal 43 amino acids (delta 43) and a full-length Leu323 mutant receptor that is expressed on the cell surface but that does not bind insulin. A clonal cell line was selected from cells cotransfected with a 1/5 ratio of delta 43 cDNA/Leu323 cDNA. The two homodimers (Leu323 and delta 43) were expressed without detectable formation of hybrid receptors. By using specific antibodies, we demonstrate that in cells coexpressing both homodimers, the Leu323 mutant receptor was phosphorylated in vivo by the delta 43 IR in an insulin-dependent manner. However, when the Leu323 mutant receptor was expressed alone, no phosphorylation was detected. In addition, we demonstrate the association of the phosphorylated Leu323 mutant receptor with insulin receptor substrate-1 and with phosphatidylinositol 3-kinase. These findings indicate that insulin binding is not required for phosphorylation of the Leu323 mutant receptor, that the phosphorylation of the Leu323 mutant receptor occurs by an intermolecular transphosphorylation mechanism, and, finally, that the Leu323 mutant receptor, once phosphorylated, can associate with insulin receptor substrate-1 and phosphatidylinositol 3-kinase.