cDNA clones of the Drosophila epidermal growth factor receptor homolog (DER) gene were isolated and sequenced. The deduced amino acid sequence shows a similar degree of homology to the human epidermal growth factor receptor and to the rat and human neu proteins; the most striking difference is the addition of a third cysteine-rich extracellular domain in DER. The structure of the cDNA indicates the use of alternative 5' exons. Thus, the gene encodes three putative proteins differing at their N termini. The distribution of DER transcripts was analyzed by in situ hybridization. Transcripts are uniformly distributed in embryos, larval transcripts are primarily localized to proliferating tissues of the imaginal discs and brain cortex, and adult transcripts are detected mainly in the brain and ganglia. All three splicing alternatives show similar tissue distribution during development.