In this study, 7 years (1986--1992) of measurements from the Japanese middle and upper atmosphere (MU) radar have been analyzed to investigate the solar activity variations of the ionosphere. The observations show strong altitude dependencies in the solar activity variations of the electron density. Below 300 km altitude, the electron density increases nonlinearly with F10.7, with the rate of increase being much lower when F10.7 is greater than 150. This nonlinear variation becomes weaker with increasing altitude. Above 450 km altitude, the electron density increases almost linearly with F10.7 when F10.7 lies in the range 100 to 250. For values of F10.7 less than 100, the electron density at low altitudes increases with increasing F10.7, while at higher altitudes (above about 400 km) the electron density remains almost constant. Mechanisms to explain the observed behavior have been investigated using the Sheffield University Plasmasphere Ionosphere Model. The model calculations show that while the variations with F10.7 of the solar EUV flux and neutral gas densities play important roles in the nonlinear variations of the electron density with F10.7, the correlation of the plasma loss rate with temperature being negative at low temperatures and positive at high temperatures is an important mechanism for the nonlinear variations at low altitudes. Model results also suggest that vibrationally excited N2 strengthens the nonlinear variations of electron density with F10.7. The disappearance of the nonlinear variations at high altitudes, for values of F10.7 above 100, results from the altitude dependencies of the neutral gas variation on F10.7 and of the relative importance of plasma loss, production, and diffusion processes. At high altitudes, the plasma loss processes, which play an important role in the nonlinear variations at low altitudes, are unimportant when compared with the effects arising from plasma production and diffusion. The altitude dependencies of the electron density variations with F10.7, for values of F10.7 less than 100, are due mainly to the altitude dependencies of the neutral gas densities with F10.7. ¿ 1999 American Geophysical Union