Conjugation of xenobiotic compounds and endogenous metabolites to glutathione is an ubiquitous process in eukaryotes. In animals, the first and rate-limiting step of glutathione-S-conjugate metabolism is characterized by the removal of the aminoterminal glutamic acid residue of glutathione. In plants, however, glutathione-S-conjugates are generally metabolized by removal of the carboxylterminal glycine residue of the tripeptide glutathione to give rise to the S-glutamylcysteinyl-derivative. Purification of the glutathione-conjugate catabolizing activity from cell suspension cultures of the plant Silene cucubalus indicated that phytochelatin synthase catalyzes the first step of the pathway. Heterologously expressed phytochelatin synthase from Arabidopsis efficiently converted S-bima ne-glutathione to S-bimane-glutamylcysteine, the formation of which was unequivocally identified by mass spectrometry. No further products, such as S-derivatives of phytochelatins, were observed. Several different glutathione-S-conjugates served as substrates for the enzyme and were processed to the corresponding glutamylcysteinyl-adducts. Affinity-purified phytochelatin synthase preparations required divalent heavy metal ions such as Cd(2+), Zn(2+) or Cu(2+) for detectable turnover of glutathione-S-conjugates. Characterization of the enzymatic properties of phytochelatin synthase argues for both cellular functions of the gamma-glutamylcysteinyl-dipeptidyltransferase: (1) formation of heavy-metal binding peptides and (2) degradation of glutathione-S-conjugates. Mechanistically, the former role is the result of gamma-glutamylcysteinyl transpeptidation onto glutathione or derivatives thereof, while the catabolic function reflects transpeptidation of S-glutamylcysteinyl-adducts onto the acceptor molecule water. Thus, phytochelatin synthase seems to fulfil a second crucial role in glutathione metabolism.