The binding of urokinase-type plasminogen activator (uPA) to its specific cell-surface receptor (uPAR) localises the proteolytic cascade initiated by uPA to the pericellular environment. Inhibition of uPA activity or prevention of uPA binding to uPAR might have a beneficial effect on disease states wherein this activity is deregulated, e.g. cancer and some inflammatory diseases. To this end, a bifunctional hybrid molecule consisting of the uPAR-binding growth-factor domain of uPA (amino acids 1 - 47; GF(uPA)) at the N-terminus of plasminogen-activator inhibitor type 2 (PAI-2) was produced in Saccharomyces cerevisiae. The purified protein inhibited uPA with kinetics similar to placental or recombinant PAI-2 and was also found to bind th U937 cells and to FL amnion cells. GF(uPA)-PAI-2 competed with uPA, the N-terminal fragment of uPA and a proteolytic fragment of uPA (amino acids 4 - 43) in cell binding experiments, indicating that the molecule bound to the cells via uPAR. Hence, both the uPA-inhibitory and uPAR-binding domains of the hybrid molecule were functional, demonstrating the feasibility of the novel concept of introducing an unrelated, functional domain onto a member of the serine-protease-inhibitor superfamily.