Alpha factor mating pheromone is a peptide of 13 amino acids secreted by Saccharomyces cerevisiae alpha cells. Nonmating ("sterile," or ste) alpha-cell mutants bearing defects in the STE13 gene do not produce normal alpha factor, but release a collection of incompletely processed forms (alpha factor) that have a markedly reduced specific biological activity. The major alpha-factor peptides have the structures H2N-GluAlaGluAla-alpha factor and H2N-AspAlaGluAla-alpha factor. The ste13 mutants lack a membrane-bound heat-stable dipeptidyl aminopeptidase (DPAPase A) that specifically cleaves on the carboxyl side of repeating -X-Ala- sequences. Absence of DPAPase A and the other phenotypes of a ste13 lesion cosegregate in genetic crosses. The cloned STE13 gene on a plasmid causes yeast cells to overproduce DPAPase A severalfold. A different cloned DNA segment, which weakly suppresses the ste13 defects, causes overproduction of a heat-labile activity (DPAPase B) by about tenfold. Other experiments indicate that DPAPase A action may be rate-limiting for alpha-factor maturation in normal alpha cells.