Phospholipase C-gamma (PLC-gamma) is a substrate of the fibroblast growth factor receptor (FGFR; encoded by the flg gene) and other receptors with tyrosine kinase activity. It has been demonstrated that the src homology region 2 (SH2 domain) of PLC-gamma and of other signalling molecules such as GTPase-activating protein and phosphatidylinositol 3-kinase-associated p85 direct their binding toward tyrosine-autophosphorylated regions of the epidermal growth factor or platelet-derived growth factor receptor. In this report, we describe the identification of Tyr-766 as an autophosphorylation site of flg-encoded FGFR by direct sequencing of a tyrosine-phosphorylated tryptic peptide isolated from the cytoplasmic domain of FGFR expressed in Escherichia coli. The same phosphopeptide was found in wild-type FGFR phosphorylated either in vitro or in living cells. Like other growth factor receptors, tyrosine-phosphorylated wild-type FGFR or its cytoplasmic domain becomes associated with intact PLC-gamma or with a fusion protein containing the SH2 domain of PLC-gamma. To delineate the site of association, we have examined the capacity of a 28-amino-acid tryptic peptide containing phosphorylated Tyr-766 to bind to various constructs containing SH2 and other domains of PLC-gamma. It is demonstrated that the tyrosine-phosphorylated peptide binds specifically to the SH2 domain but not to the SH3 domain or other regions of PLC-gamma. Hence, Tyr-766 and its flanking sequences represent a major binding site in FGFR for PLC-gamma. Alignment of the amino acid sequences surrounding Tyr-766 with corresponding regions of other FGFRs revealed conserved tyrosine residues in all known members of the FGFR family. We propose that homologous tyrosine-phosphorylated regions in other FGFRs also function as binding sites for PLC-gamma and therefore are involved in coupling to phosphatidylinositol breakdown.