Acetylcholine-binding protein (AChBP) is a novel protein with high similarity to the extracellular domain of the nicotinic acetylcholine receptor. AChBP lacks the transmembrane domains and intracellular loops typical for the nAChRs. AChBP is secreted from glia cells in the central nervous system of the freshwater snail, Lymnaea stagnalis, where it modulates synaptic transmission. AChBP forms homopentamers with pharmacology that resembles the alpha(7)-type of nicotinic receptors. As such, AChBP is a good model for the ligand-binding domain of the nAChRs. In the crystal structure of AChBP at 2.7 A, each protomer has a modified immunoglobulin fold. Almost all residues previously shown to be involved in ligand binding in the nicotinic receptor are found in a pocket at the subunit interface, which is lined with aromatic residues. The AChBP crystal structure explains many of the biochemical studies on the nicotinic acetylcholine receptors. Surprisingly, the interface between protomers is relatively weakly conserved between families in the superfamily of pentameric ligand-gated ion channels. The lack of conservation has implications for the mechanism of gating of the ion channels.