P2X receptors are membrane ion channels gated by extracellular ATP that are found widely in vertebrates, but not previously in microbes. Here we identify a weakly related gene in the genome of the social amoeba Dictyostelium discoideum, and show, with the use of heterologous expression in human embryonic kidney cells, that it encodes a membrane ion channel activated by ATP (30-100 muM). Site-directed mutagenesis revealed essential conservation of structure-function relations with P2X receptors of higher organisms. The receptor was insensitive to the usual P2X antagonists but was blocked by nanomolar concentrations of Cu2+ ions. In D. discoideum, the receptor was found on intracellular membranes, with prominent localization to an osmoregulatory organelle, the contractile vacuole. Targeted disruption of the gene in D. discoideum resulted in cells that were unable to regulate cell volume in hypotonic conditions. Cell swelling in these mutant cells was accompanied by a marked inhibition of contractile vacuole emptying. These findings demonstrate a new functional role for P2X receptors on intracellular organelles, in this case in osmoregulation.