The N-terminus of the prion protein is a toxic effector regulated by the C-terminus

PrP^C, the cellular isoform of the prion protein, serves to transduce the neurotoxic effects of PrP^Sc, the infectious isoform, but how this occurs is mysterious. Here, using a combination of electrophysiological, cellular, and biophysical techniques, we show that the flexible, N-terminal domain of PrP^C functions as a powerful toxicity-transducing effector whose activity is tightly regulated in cis by the globular C-terminal domain. Ligands binding to the N-terminal domain abolish the spontaneous ionic currents associated with neurotoxic mutants of PrP, and the isolated N-terminal domain induces currents when expressed in the absence of the C-terminal domain. Anti-PrP antibodies targeting epitopes in the C-terminal domain induce currents, and cause degeneration of dendrites on murine hippocampal neurons, effects that entirely dependent on the effector function of the N-terminus. NMR experiments demonstrate intramolecular docking between N- and C-terminal domains of PrP^C, revealing a novel auto-inhibitory mechanism that regulates the functional activity of PrP^C.