P2Y 2 and P2Y 4 receptors, which have 52% sequence identity, are both expressed at the apical membrane of Madin-Darby canine kidney cells, but the locations of their apical targeting signals are distinctly different. The targeting signal of the P2Y 2 receptor is located between the N terminus and 7TM, whereas that of the P2Y 4 receptor is present in its C-terminal tail. To identify the apical targeting signal in the P2Y 2 receptor, regions of the P2Y 2 receptor were progressively substituted with the corresponding regions of the P2Y 4 receptor lacking its targeting signal. Characterization of these chimeras and subsequent mutational analysis revealed that four amino acids (Arg 95 , Gly 96 , Asp 97 , and Leu 108 ) in the first extracellular loop play a major role in apical targeting of the P2Y 2 receptor. Mutation of RGD to RGE had no effect on P2Y 2 receptor targeting, indicating that receptor-integrin interactions are not involved in apical targeting. P2Y 2 receptor mutants were localized in a similar manner in Caco-2 colon epithelial cells. This is the first identification of an extracellular protein-based targeting signal in a seven-transmembrane receptor.Extracellular nucleotides play an important role in a broad range of physiological and pathophysiological processes through two classes of receptors, the ligand-gated P2X receptors and the G protein-coupled P2Y receptors (1, 2). To date, pharmacological characterization and molecular cloning have identified seven P2X receptors (P2X 1-7 ) and eight P2Y receptor subtypes (P2Y 1 , P2Y 2 , P2Y 4 , P2Y 6 , P2Y 11 , P2Y 12 , P2Y 13 , and P2Y 14 ). The P2Y receptors can be divided into two main subfamilies based on sequence identity and phylogenetic considerations: the P2Y 1 receptor subfamily, which is comprised of P2Y 1 , P2Y 2 , P2Y 4 , P2Y 6 , and P2Y 11 receptors, and the P2Y 12 receptor subfamily, comprising P2Y 12 , P2Y 13 , and P2Y 14 receptors. The P2Y 1 receptor subfamily is coupled to activation of phospholipase C, generation of inositol phosphates, activation of protein kinase C, and mobilization of intracellular Ca 2ϩ stores. In addition to coupling to activation of phospholipase C, the P2Y 11 receptor is also coupled to G s , thereby activating adenylyl cyclase (3-5). In contrast, the three members of the P2Y 12 receptor subfamily couple to G i/o and therefore inhibit adenylyl cyclase (6 -8).Although P2Y receptors mediate a multitude of cellular responses throughout the body, one of their main functions is to regulate ion transport in polarized epithelial cells. Proteins in polarized epithelial cells can be expressed predominantly at either the apical or basolateral membrane surface, or they can be indiscriminatingly distributed to both membranes. The proper targeting of proteins to their respective membrane surface is critical in host defense, nutrient absorption, ion transport, and signal transduction. However, the mechanism(s) by which epithelial cells target proteins to a particular membrane surface remains a critical question in epithelial cell b...