Several precursors transported from the cytoplasm to the intermembrane space of yeast mitochondria are first cleaved by the MAS-encoded protease in the matrix space and then by additional proteases that have not been characterized. We have now developed a specific assay for one of these other proteases. The enzyme is an integral protein of the inner membrane; it requires divalent cations and acidic phospholipid for activity, and is defective in yeast mutant pet ts2858 which accumulates an incompletely processed cytochrome b2 precursor. The protease contains a 21.4 kd subunit whose C-terminal part is exposed on the outer face of the inner membrane. An antibody against this polypeptide inhibits the activity of the protease. As overproduction of the polypeptide does not increase the activity of the protease in mitochondria, the enzyme may be a hetero-oligomer. This 'inner membrane protease I' shares several key features with the leader peptidase of Escherichia coli and the signal peptidase of the endoplasmic reticulum.