Cross-linking of Ly-6 molecules on T lymphocytes leads to IL-2 production, whereas costimulation of T cells via Ly-6A/E and the TCR inhibits IL-2 secretion. This study was initiated to determine whether there are unique structural requirements at the level of the Ly-6 molecule for its capacity to activate or block IL-2 production. Functional studies in which transfected EL-4J cells that expressed various Ly-6 proteins or chimeric Ly-6 molecules were used have demonstrated that direct activation of IL-2 secretion or inhibition of anti-CD3-induced IL-2 production occurred after mAb binding to Ly-6A/E, Ly-6C, and Ly-6G and was independent of whether the mAbs bound to amino- or carboxyl-terminal epitopes of Ly-6. The blockade of IL-2 production by costimulation with anti-CD3 and anti-Ly-6 was detected even when the addition of either mAb was temporally delayed for up to 17 h in a reciprocal fashion. Stimulation of mouse Ly-6 proteins expressed in Jurkat cells antagonized PMA/OKT3-induced IL-2 production, thus revealing that the Ly-6 inhibitory pathway is operative in human cells. EL-4J cells were also transfected with a chimeric construct in which the glycosylphosphatidylinositol anchor of Ly-6E was replaced by the transmembrane and a portion of the intracytoplasmic tail of H-2Db. Anti-Ly-6A/E also blocked anti-CD3-induced IL-2 production for these cells, although anti-Ly-6A/E failed to directly induce IL-2 secretion. Thus, anti-Ly-6A/E blockade of IL-2 production is independent of the glycosylphosphatidylinositol anchor of Ly-6E. This finding suggests that there may be aspects of signaling via Ly-6 that are solely dependent on the extracellular amino acid sequence of this protein.