Discovery of proteins expressed in the central nervous system sharing the three-finger structure with snake ␣-neurotoxins provoked much interest to their role in brain functions. Prototoxin LYNX1, having homology both to Ly6 proteins and threefinger neurotoxins, is the first identified member of this family membrane-tethered by a GPI anchor, which considerably complicates in vitro studies. We report for the first time the NMR spatial structure for the water-soluble domain of human LYNX1 lacking a GPI anchor (ws-LYNX1) and its concentration-dependent activity on nicotinic acetylcholine receptors (nAChRs). At 5-30 M, ws-LYNX1 competed with 125 I-␣-bungarotoxin for binding to the acetylcholine-binding proteins (AChBPs) and to Torpedo nAChR. Exposure of Xenopus oocytes expressing ␣7 nAChRs to 1 M ws-LYNX1 enhanced the response to acetylcholine, but no effect was detected on ␣42 and ␣32 nAChRs. Increasing ws-LYNX1 concentration to 10 M caused a modest inhibition of these three nAChR subtypes. A common feature for ws-LYNX1 and LYNX1 is a decrease of nAChR sensitivity to high concentrations of acetylcholine. NMR and functional analysis both demonstrate that ws-LYNX1 is an appropriate model to shed light on the mechanism of LYNX1 action. Computer modeling, based on ws-LYNX1 NMR structure and AChBP x-ray structure, revealed a possible mode of ws-LYNX1 binding.Endogenous "prototoxins" like LYNX1, LYNX2, SLURP-1, and SLURP-2, belonging to the Ly6 protein family, modulate nicotinic acetylcholine receptors (nAChRs) 3 (1-8). In the central nervous system, LYNX1 and LYNX2 regulate nAChR activity, preventing excessive excitation (3, 4). Gene deletion of LYNX1 or LYNX2 indicates that these modulators are critical for nAChR function in the brain. LYNX1 knock-out mice demonstrated enhanced performance in specific tests of learning ability and memory, whereas loss of LYNX2 results in increased anxiety-related behaviors (3, 4). Prototoxins have also been shown to affect cell growth in lung carcinoma (9), are involved in skin diseases (6, 7), and are related to prostate stem cell antigen (10).LYNX1 and LYNX2 are tethered to the membrane by a GPI anchor, which considerably complicates in vitro studies. LYNX1 is co-localized in the brain with ␣42 and ␣7 nAChRs (1-3), and its modulatory activity on ␣42 nAChR was shown in experiments on Xenopus oocytes (1, 3). It was reported that soluble form of LYNX1 (not containing a GPI anchor) potentiates ␣42 receptor (1), but the concentration at which it acts remains unknown. A secreted water-soluble protein SLURP-1 expressed in palmoplantar skin acts on ␣7 nAChR and regulates keratinocyte proliferation (5).It was predicted that the prototoxins should have a spatial structure similar to that of snake venom ␣-neurotoxins, effective competitive inhibitors of nAChR (1). ␣-Neurotoxins are characterized by a three-finger fold formed by three adjacent loops arising from a small globular hydrophobic core, crosslinked by four conserved disulfide bonds (11-13). Nicotinic acetylcholine receptors are ta...