Mutations in the phosphotyrosine binding domain protein ARH cause autosomal recessive hypercholesterolemia, a disorder caused by defective internalization of low density lipoprotein receptors (LDLR) in the liver. To examine the function of ARH, we used pull-down experiments to test for interactions between ARH, the LDLR, and proteins involved in clathrin-mediated endocytosis. The phosphotyrosine binding domain of ARH interacted with the internalization sequence (NPVY) in the cytoplasmic tail of LDLR in a sequence-specific manner. Mutations in the NPVY sequence that were previously shown to decrease LDLR internalization abolished in vitro binding to ARH. Recombinant ARH bound purified bovine clathrin with high affinity (K(D), approximately 44 nm). The interaction between ARH and clathrin was mapped to a canonical clathrin box sequence (LLDLE) in ARH and to the N-terminal domain of the clathrin heavy chain. A highly conserved 20-amino acid sequence in the C-terminal region of ARH bound the beta(2)-adaptin subunit of AP-2. Mutation of a glutamic acid residue in the appendage domain of beta(2)-adaptin that is required for interaction with the adapter protein beta-arrestin markedly reduced binding to ARH. These data are consistent with the hypothesis that ARH functions as an adaptor protein that couples LDLR to the endocytic machinery.