Lateral interaction is an important feature of various types of cell surface receptors including the receptor tyrosine kinases (RTKs). Here we report that dynamic lateral interaction produces amplification and variation in signalling of the EGF receptor, a member of RTKs. Binding of EGF is known to induce transphosphorylation inside EGFR dimers. Using single-molecule techniques, the relationship between EGF binding and EGFR phosphorylation has been determined. The number of phosphorylated EGFR molecules became larger than that of EGF binding as unliganded EGFR was phosphorylated, meaning an amplification of EGF signalling. EGFR formed clusters continuously exchanging their elements through thermal diffusion, and direct and/or indirect lateral interactions. As a result, various types of activation sites differing in number of activated receptors were generated. Amplification required no cytoplasmic factors and was observed on semi-intact cells for a wide range of number of EGFR molecules (10(4)-10(6) per cell) suggesting generality of this process.