Recombinant full-length human CD23 has been incorporated into fluorescent liposomes to demonstrate the existence of a ligand for CD23 that is different from the previously known ligand, immunoglobulin E (IgE). The novel ligand for CD23 is expressed on subsets of normal T cells and B cells as well as on some myeloma cell lines. The interaction of full-length CD23 with its ligand is specifically inhibited by anti-CD23 monoclonal antibodies and by IgE, and it is Ca2+ dependent. Moreover, tunicamycin treatment of a CD23-binding cell line, RPMI 8226, significantly reduced the binding of CD23 incorporated into fluorescent liposomes, and a sugar, fucose-1-phosphate, was found to inhibit CD23-liposome binding to RPMI 8226 cells, suggesting the contribution of sugar structures on the CD23 ligand. In addition, CD23-transfected COS cells were shown to form specific conjugates with the cell line RPMI 8226. These data demonstrate that CD23 interacts with a ligand, which is different from IgE, and that CD23 can be considered as a new surface adhesion molecule involved in cell-cell interactions.