A hamster sperm 26 kDa protein (P26h) is strikingly homologous with mouse lung carbonyl reductase (MLCR) and is highly expressed in the testis, but its physiological functions in the testis are unknown. We show that recombinant P26h resembles NADP(H)-dependent MLCR in the tetrameric structure, broad substrate specificity, inhibitor sensitivity, and activation by arachidonic acid, but differs in a preference for NAD(H) and high efficiency for the oxidoreduction between 5alpha-androstane-3alpha,17beta-diol (k(cat)/K(M) = 243 s(-1) mM(-1)) and 5alpha-dihydrotestosterone (k(cat)/K(M) = 377 s(-1) mM(-1)). The replacement of Ser38-Leu39-Ile40 in P26h with the corresponding sequence (Thr38-Arg39-Thr40) of MLCR led to a switch in favor of NADP(H) specificity, suggesting the key role of the residues in the coenzyme specificity. While the P26h mRNA was detected only in the testis of the mature hamster tissues, its enzyme activity was found mainly in the mitochondrial fraction of the testis and in the nuclear fraction of the epididymis on subcellular fractionation, in which a mitochondrial enzyme, isocitrate dehydrogenase, exhibited a similar distribution pattern. The enzyme activity of P26h in the two tissue subcellular fractions was effectively solubilized by mixing with 1% Triton X-100 and 0.2 M KCl, and enhanced more than 10-fold. The enzymes purified from the two tissue fractions exhibited almost the same structural and catalytic properties as those of the recombinant P26h. These results suggest that P26h mainly exists as a tetrameric dehydrogenase in mitochondria of testicular cells and plays a role in controlling the intracellular concentration of a potent androgen, 5alpha-dihydrotestosterone, during spermatogenesis, in which it may be incorporated in mitochondrial sheaths of spermatozoa.