Penetration of a cell membrane as an early event in infection of cells by mammalian reoviruses appears to require a particular type of viral particle, the infectious subvirion particle (ISVP), which is generated from an intact virion by proteolytic cleavage of the outer capsid proteins sigma 3 and mu 1/mu 1C. Characterizations of the structural components and properties of ISVPs are thus relevant to attempts to understand the mechanism of penetration by reoviruses. In this study, a novel, approximately 13-kDa carboxy-terminal fragment (given the name phi) was found to be generated from protein mu 1/mu 1C during in vitro treatments of virions with trypsin or chymotrypsin to yield ISVPs. With trypsin treatment, both the carboxy-terminal fragment phi and the amino-terminal fragment mu 1 delta/delta were shown to be generated and to remain attached to ISVPs in stoichiometric quantities. Sites of protease cleavage were identified in the deduced amino acid sequence of mu 1 by determining the amino-terminal sequences of phi proteins: trypsin cleaves between arginine 584 and isoleucine 585, and chymotrypsin cleaves between tyrosine 581 and glycine 582. Findings in this study indicate that sequences in the phi portion of mu 1/mu 1C may participate in the unique functions attributed to ISVPs. Notably, the delta-phi cleavage junction was predicted to be flanked by a pair of long amphipathic alpha-helices. These amphipathic alpha-helices, together with the myristoyl group at the extreme amino terminus of mu 1/mu 1N, are proposed to interact directly with the lipid bilayer of a cell membrane during penetration by mammalian reoviruses.