The first group I intron in the cox1 gene (cox1I1b ) of the mitochondrial genome of the fission yeast Schizosaccharomyces pombe is a mobile DNA element. The mobility is dependent on an endonuclease protein that is encoded by an intronic open reading frame (ORF). The intron-encoded endonuclease is a typical member of the LAGLIDADG protein family of endonucleases with two consensus motifs. In addition to this, analysis of several intron mutants revealed that this protein is required for intron splicing. However, this protein is one of the few group I intron-encoded proteins that functions in RNA splicing simultaneously with its DNA endonuclease activity. We report here on the biochemical characterization of the endonuclease activity of this protein artificially expressed in Escherichia coli. Although the intronic ORF is expressed as a fusion protein with the upstream exon in vivo, the experiments showed that a truncated translation product consisting of the C-terminal 304 codons of the cox1I1b ORF restricted to loop 8 of the intron RNA secondary structure is sufficient for the specific endonuclease activity in vitro. Based on the results, we speculate on the evolution of site-specific homing endonucleases encoded by group I introns in eukaryotes.