Erythropoietin and other cytokine receptors are thought to be activated through hormone-induced dimerization and autophosphorylation of JAK kinases associated with the receptor intracellular domains. An in vivo protein fragment complementation assay was used to obtain evidence for an alternative mechanism in which unliganded erythropoietin receptor dimers exist in a conformation that prevents activation of JAK2 but then undergo a ligand-induced conformation change that allows JAK2 to be activated. These results are consistent with crystallographic evidence of distinct dimeric configurations for unliganded and ligand-bound forms of the erythropoietin receptor.