Aspartoacylase catalyzes the deacetylation of N-acetylaspartic acid (NAA) in the brain to produce acetate and L-aspartate. An aspartoacylase deficiency, with concomitant accumulation of NAA, is responsible for Canavan disease, a lethal autosomal recessive disorder. To examine the mechanism of this enzyme the genes encoding murine and human aspartoacylase were cloned and expressed in Escherichia coli. A significant portion of the enzyme is expressed as soluble protein, with the remainder found as inclusion bodies. A convenient enzyme-coupled continuous spectrophotometric assay has been developed for measuring aspartoacylase activity. Kinetic parameters were determined with the human enzyme for NAA and for selected N-acyl analogs that demonstrate relaxed substrate specificity with regard to the nature of the acyl group. The clinically relevant E285A mutant reveals an altered enzyme with poor stability and barely detectable activity, while a more conservative E285D substitution leads to only fivefold lower activity than native aspartoacylase.