Limulus amebocyte lysate, obtained from horseshoe crab (Limulus polyphemus) blood cells, contains a coagulation system which is activated by bacterial lipopolysaccharide (LPS). A chromatographic fraction of Limulus lysate, containing the endotoxin-sensitive factor(s) which initiates the coagulation cascade, was studied. We utilized a photoreactive, cleavable, radiolabeled derivative of Salmonella minnesota LPS, LPS-(p-azidosalicylamido)-1,3'-dithiopropionamide (LPS-ASD), to identify LPS-binding proteins. The lysate fraction was incubated with LPS-ASD, and LPS-binding proteins were identified by autoradiography of sodium dodecyl sulfate-polyacrylamide gels. An 82-kDa protein, a major protein component of this fraction from Limulus lysate, was identified as a LPS-binding protein in a majority of lysates. Incubation of whole Limulus lysate with antiserum to this protein resulted in enhanced sensitivity of the lysate to LPS, suggesting that this 82-kDa protein is a negative regulator of coagulation. A minor 50-kDa protein component of lysate also was identified as a LPS-binding protein and is a candidate for the LPS-sensitive coagulation protein in L. polyphemus.