The binding and activation of the discoidin domain receptor 1 by collagen has led to the conclusion that proteins from the extracellular matrix can directly induce receptor tyrosine kinase-mediated signaling cascades. A region in the extracellular domain of DDR1 homologous to the Dictyostelium discoideum protein discoidin-I is also present in the secreted human protein RS1. Mutations in RS1 cause retinoschisis, a genetic disorder characterized by ablation of the retina. By introducing point mutations into the discoidin domain of DDR1 at positions homologous to the retinoschisis mutations, ligand binding epitopes in the discoidin domain of DDR1 were mapped. Surprisingly, some residues only affected receptor phosphorylation, whereas others influenced both collagen-binding and receptor activation. Furthermore, two truncated DDR1 variants, lacking either the discoidin domain or the stalk region between the discoidin and transmembrane domain, were generated. We showed that (i) the discoidin domain was necessary and sufficient for collagen binding, (ii) only the region between discoidin and transmembrane domain was glycosylated, and (iii) the entire extracellular domain was essential for transmembrane signaling. Using these results, we were able to predict key sites in the collagen-binding epitope of DDR1 and to suggest a potential mechanism of signaling.