Determination of dorsal/ventral polarity in Drosophila requires 12 genetically defined, maternally encoded proteins. These include Toll, a transmembrane receptor, Pelle, a ser/thr protein kinase and Tube, all of which function intracytoplasmically to initiate the cascade that ultimately activates Dorsal, an NF-kappaB family transcription factor. Here we describe biochemical interactions between recombinant Toll, Pelle and Tube that provide insights into early events in activation of the signaling cascade. We first show that Pelle binds directly to a region within the Toll intracytoplasmic domain, providing the first evidence that these two evolutionarily conserved molecules physically interact. We then demonstrate that Pelle can be autophosphorylated, and that this prevents binding to Toll as well as Tube. Autophosphorylation occurs in the N-terminal, death-domain-containing region of Pelle, which is dispensable for binding to Toll but required for enzymatic activity. We also show that Pelle phosphorylates Toll, within the region required for Pelle interaction, but this phosphorylation can be blocked by a previously characterized inhibitory domain at the Toll C terminus. These and other results allow us to propose a model by which multiple phosphorylation-regulated interactions between these three proteins lead to activation of the Dorsal signaling pathway.