The intracellular domain of the insulin receptor possesses activity as a tyrosine-specific protein kinase which is stimulated by insulin binding to the extracellular domain of the receptor. We have identified a patient with a genetic form of insulin resistance who is heterozygous for a mutation substituting Glu for Ala1135 in the putative “catalytic loop” of the tyrosine kinase domain of the receptor. In this investigation, the Glu1135 mutant receptor was expressed by transfection of mutant cDNA into NIH-3T3 cells. Like previously described mutations in the tyrosine kinase domain, the Glu1135 mutation impairs receptor tyrosine kinase activity and inhibits the ability of insulin to stimulate thymidine incorporation and receptor endocytosis. These data support the hypothesis that the receptor tyrosine kinase activity plays a necessary role in the ability of the receptor to mediate insulin action in vitro and in vivo. However, unlike previously described mutations in the intracellular domain of the receptor, the Glu1135 mutation impairs proteolytic cleavage of the proreceptor into separate subunits and impairs the transport of the receptor to the cell surface. These latter defects provide an explanation for the decrease in the number of receptors on the cell surface observed in the patient's circulating monocytes despite the fact that the mutant receptor is resistant to endocytosis and insulin-induced down-regulation.