Using sequence similarity searches and top-of-the-range fold-recognition methods, we have identified a novel family of bacterial transglutaminase-like cysteine proteinases (BTLCPs) with an invariant Cys-His-Asp catalytic triad and a predicted N-terminal signal sequence. This family of previously uncharacterized hypothetical proteins encompasses sequences of unknown function from DUF920 (in the Pfam database) and COG3672. BTLCPs are predicted to possess the papain-like cysteine proteinase fold and catalyze post-translational protein modification through transamidase, acetylase or hydrolase activity. Inspection of neighboring genes encoding BTLCPs suggests a link between this predicted activity and a type-I secretion system resembling ATP-binding cassette exporters of toxins and proteases involved in bacterial pathogenicity.