Pigment epithelium-derived factor (PEDF) is an extracellular multifunctional protein belonging to the serpin superfamily with demonstrable neurotrophic, gliastatic, neuronotrophic, antiangiogenic, and antitumorigenic properties. We have previously provided biochemical evidence for high affinity PEDFbinding sites and proteins in plasma membranes of retina, retinoblastoma, and CNS cells. This study was designed to reveal a receptor involved in the biological activities of PEDF. Using a yeast two-hybrid screening, we identified a novel gene from pigment epithelium of the human retina that codes for a PEDFbinding partner, which we term PEDF-R. The derived polypeptide has putative transmembrane, intracellular and extracellular regions, and a phospholipase domain. Recently, PEDF-R (TTS-2.2/independent phospholipase A 2 (PLA 2 ) and mouse desnutrin/ATGL) has been described in adipose cells as a member of the new calcium-independent PLA 2 /nutrin/patatin-like phospholipase domain-containing 2 (PNPLA2) family that possesses triglyceride lipase and acylglycerol transacylase activities. Here we describe the PEDF-R gene expression in the retina and its heterologous expression by bacterial and eukaryotic systems, and we demonstrate that its protein product has specific and high binding affinity for PEDF, has a potent phospholipase A 2 activity that liberates fatty acids, and is associated with eukaryotic cell membranes. Most importantly, PEDF binding stimulates the enzymatic phospholipase A 2 activity of PEDF-R. In conclusion, we have identified a novel PEDF-R gene in the retina for a phospholipase-linked membrane protein with high affinity for PEDF, suggesting a molecular pathway by which ligand/receptor interaction on the cell surface could generate a cellular signal.