The neural adhesion molecule L1 mediates the axon outgrowth, adhesion, and fasciculation that are necessary for proper development of synaptic connections. L1 gene mutations are present in humans with the X-linked mental retardation syndrome CRASH (corpus callosum hypoplasia, retardation, aphasia, spastic paraplegia, hydrocephalus). Three missense mutations associated with CRASH syndrome reside in the cytoplasmic domain of L1, which contains a highly conserved binding region for the cytoskeletal protein ankyrin. In a cellular ankyrin recruitment assay that uses transfected human embryonic kidney (HEK) 293 cells, two of the pathologic mutations located within the conserved SFIGQY sequence (S1224L and Y1229H) strikingly reduced the ability of L1 to recruit 270 kDa ankyrinG protein that was tagged with green fluorescent protein (ankyrin-GFP) to the plasma membrane. In contrast, the L1 missense mutation S1194L and an L1 isoform lacking the neuron-specific sequence RSLE in the cytoplasmic domain were as effective as RSLE-containing neuronal L1 in the recruitment of ankyrin-GFP. Ankyrin binding by L1 was independent of cell-cell interactions. Receptor-mediated endocytosis of L1 regulates intracellular signal transduction, which is necessary for neurite outgrowth. In rat B35 neuroblastoma cell lines stably expressing L1 missense mutants, antibody-induced endocytosis was unaffected by S1224L or S1194L mutations but appeared to be enhanced by the Y1229H mutation. These results suggested a critical role for tyrosine residue 1229 in the regulation of L1 endocytosis. In conclusion, specific mutations within key residues of the cytoplasmic domain of L1 (Ser(1224), Tyr(1229)) destabilize normal L1-ankyrin interactions and may influence L1 endocytosis to contribute to the mechanism of neuronal dysfunction in human X-linked mental retardation.