We have isolated and mapped to the left end of chromosome III a single-copy gene (TRG1) encoding a 72-kDa glycoprotein, by screening a yeast genomic library with a DNA probe specifying the catalytic center (APWCGHCK) of thioredoxin-related proteins. the TRG1 gene sequence predicts an amino-terminal leader peptide, two thioredoxin-like domains, five N-glycosylation sites and a carboxyl-terminal HDEL retention signal. The TRG1 protein shows about equal sequence similarity to a mammalian multifunctional protein family residing in the lumen of the endoplasmic reticulum (ER), and to a putative cytosolic alpha form of phosphoinositide-specific phospholipase C. Haploid cells do not survive TRG1 gene disruptions, unless an additional wild-type copy is generated by interchromosomal transposition. Antibodies raised against synthetic amino- and carboxyl-terminal epitopes recognize a pair of lumenl ER glycoproteins (gp70/72) and a cytosolic 48-kDa protein. A 1.8-kilobase TRG1 transcript was translated by a reticulocyte lysate into a 60-kDa protein, which was translocated and processed to a 72-kDa glycoprotein in the presence of ER membrane vesicles. The TRG1 gene was placed under the control of the galactose-inducible and glucose-repressible GAL1 promoter, leading to growth arrest in glucose media. Glucose repression of the TRG1 gene caused the disappearance of gp72 and the accumulation of procarboxypeptidase. Our data indicate that the TRG1 gene encodes a growth essential lumenal ER glycoprotein involved the maturation of vacuolar carboxypeptidase.