A grin is a motor neuron-derived factor that directs formation of the postsynaptic apparatus of the neuromuscular junction. Agrin is also expressed in the brain, raising the possibility that it might serve a related function at neuron-neuron synapses. Previously, we identified an agrin signaling pathway in central nervous system (CNS) neurons, establishing the existence of a neural receptor that mediates responses to agrin. As a step toward identifying this agrin receptor, we have characterized the minimal domains in agrin that bind and activate it. Structures required for agrin signaling in CNS neurons are contained within a 20-kD COOH-terminal fragment of the protein. Agrin signaling is independent of alternative splicing at the z site, but requires sequences that flank it because their deletion results in a 15-kD fragment that acts as an agrin antagonist. Thus, distinct regions within agrin are responsible for receptor binding and activation. Using the minimal agrin fragments as affinity probes, we also studied the expression of the agrin receptor on CNS neurons. Our results show that both agrin and its receptor are concentrated at neuron-neuron synapses. These data support the hypothesis that agrin plays a role in formation and/or function of CNS synapses.