C-type natriuretic peptide (CNP) increases long bone growth by stimulating guanylyl cyclase (GC)-B/NPR-B/NPR2. Recently, a Val to Met missense mutation at position 883 in the catalytic domain of GC-B was identified in humans with increased blood cGMP levels that cause abnormally long bones. Here, we determined how this mutation activates GC-B. In the absence of CNP, cGMP levels in cells expressing V883M-GC-B were increased more than 20 fold compared to cells expressing wild-type (WT)-GC-B, and the addition of CNP only further increased cGMP levels 2-fold. In the absence of CNP, maximal enzymatic activity (Vmax) of V883M-GC-B was increased 15-fold compared to WT-GC-B but the affinity of the enzymes for substrate as revealed by the Michaelis constant (Km) was unaffected. Surprisingly, CNP decreased the Km of V883M-GC-B 10-fold in a concentration dependent manner without increasing Vmax. Unlike the WT enzyme the Km reduction of V883M-GC-B did not require ATP. Unexpectedly, V883M-GC-B, but not WT-GC-B, failed to inactivate with time. Phosphorylation elevated but was not required for the activity increase associated with the mutation because the Val to Met substitution also activated a GC-B mutant lacking all known phosphorylation sites. We conclude that the V883M mutation increases maximal velocity in the absence of CNP, eliminates the requirement for ATP in the CNP-dependent Km reduction, and disrupts the normal inactivation process.