Endotoxin (lipopolysaccharide; LPS) activates a wide variety of host defense mechanisms. In mammals LPS binding protein (LBP) and CD14 interact with LPS to mediate cellular activation. Using sucrose density gradients and a fluorescent endotoxin derivative we have investigated the mechanism of LPS binding to LBP and the soluble form of CD14 (sCD14). LPS binds to LBP to form two types of complex; at low ratios of LPS to LBP complexes with one molecule of LBP and 1-2 molecules of LPS predominate, while at high ratios of LPS to LBP a large aggregate of LBP and LPS predominates. Complexes of LPS with sCD14 do not form large aggregates, consisting of only 1-2 LPS bound to a single sCD14 even at high multiples of LPS to sCD14. LBP catalyzes LPS binding to sCD14. Catalysis by LBP apparently occurs because LBP provides a pathway for LPS to bind to sCD14 which avoids the necessity for LPS monomers in aqueous solution. The dissociation constants for LPS.LBP and LPS.sCD14 complexes were determined to be 3.5 x 10(-9) and 29 x 10(-9) M, respectively. These numbers suggest that when LBP and sCD14 are present at roughly equal concentrations as they are in normal human plasma and compete for limited LPS, the LPS will predominantly associate with LBP.