Drosophila chaoptin, required for photoreceptor cell morphogenesis, is a member of the leucine-rich repeat family of proteins. On the basis of biochemical and genetic analyses we previously proposed that chaoptin might function as a cell adhesion molecule. To test this hypothesis, chaoptin cDNA driven by the hsp 70 promoter was transfected into non-self-adherent Drosophila Schneider line 2 (S2) cells. Following heat shock induction of chaoptin expression, the transfected S2 cells formed multicellular aggregates. Mixing experiments of chaoptin expressing and non-expressing cells suggest that chaoptin expressing cells adhere homotypically. Previously it was shown that chaoptin is exclusively localized to photoreceptor cells. Thus, chaoptin is a cell-type-specific adhesion molecule. Biochemical analyses presented in this paper demonstrate that chaoptin is linked to the extracellular surface of the plasma membrane by covalent attachment to glycosylphosphatidylinositol. We propose that chaoptin and several other members of the leucine-rich repeat family of proteins define a new class of cell adhesion molecules.