The molecular cloning of a murine receptor-type protein tyrosine phosphatase, termed PTP NU-3, with an extracellular cell-adhesion-molecule-like domain is reported. NU-3 was isolated from 11.5-day total mouse embryonic RNA by reverse-transcriptase PCR using degenerate oligonucleotides flanking the conserved protein tyrosine phosphatase catalytic domain. This produced a 280-bp DNA probe which was subsequently employed to screen a mouse embryonic kidney library. Several overlapping cDNA clones were isolated, collectively forming a cDNA of 6.0 kb that encodes a putative 211 -kDa protein. Northern-blot analysis of total RNA from adult and embryonic mouse tissues indicates the existence of two major PTP NU-3 transcripts of approximately 6 kb and 7 kb. Both messages are expressed predominantly in brain tissues and neuronal-derived cell lines, although detectable levels of the 7-kb message were found in other non-neuronal tissues. We have identified a unique 132-bp exon segment that is present in the 7-kb message but is completely absent in the 6-kb transcript, suggesting tissue-specific levels of expression and RNA processing. Analysis of the amino acid sequence encoded by the 132-bp segment reveals that it completes a partial fibronectin type-I11 element resulting in a protein with a total of nine such elements. Bacterial expression of the two catalytic domains demonstrated that only the first domain possesses enzymic activity towards a tyrosine phosphorylated substrate.The location, extent and timing of protein phosphorylation at tyrosine residues have been shown to be key processes in events such as cell homeostasis, growth and proliferation. This is evidenced by the identification of multiple oncogenes encoding protein tyrosine kinases (PTKs) and the correlation of an oncogenic state with tyrosine phosphorylation of specific proteins. Therefore, much attention is now focussed on enzymes which perform the reverse reaction, namely protein tyrosine phosphatase (PTPases; for a recent review, see Mourey and Dixon, 1994). Cloning efforts by many groups have led to the identification of two major classes of PTPases. The first class is specific to phosphorylated tyrosine residues and a second class, known as the VH1-type PTPases, can dephosphorylate phosphorylated tyrosine as well as serine and threonine residues. The former can be further subdivided into two major groups; the intracellular and the receptor-like enzymes. Intracellular PTPases are generally small proteins containing one highly conserved catalytic domain, whereas the receptor-type enzymes usually