cDNA encoding human monocyte/neutrophil elastase inhibitor (EI), a M(r) approximately 42,000 protein with serpin-like functional properties, has been sequenced. The 1316-base-pair sequence was obtained from overlapping clones and amplified DNA from libraries of monocyte-like and neutrophil-like cells. Hybridization with EI cDNA identified three EI mRNA species of 1.5, 1.9, and 2.6 kilobases in U937 monocyte-like cells and no hybridizing mRNA in lymphoblastoid cells lacking detectable EI. The cDNA open reading frame encodes a 379-amino acid protein, of which 167 residues were confirmed by tryptic peptides. Although EI may function extracellularly as well as intracellularly, its deduced sequence lacks a typical cleavable N-terminal signal sequence. Sequence analysis established that EI is a member of the serpin superfamily. EI has greatest homology (50.1% identity of amino acids) with plasminogen activator inhibitor 2, also a monocyte protein, and ovalbumin and gene Y, which were previously grouped as an ancient branch of the serpin superfamily. The extent of EI identity with the functionally related serpin alpha 1 antitrypsin is only 30.1%. Sequence alignment indicates that the reactive center P1 residue is Cys-344, consistent with abrogation of elastase inhibitory activity by iodoacetamide and making EI a naturally occurring Cys-serpin. The cleavable bond, Cys-Met, suggests an oxidation-sensitive molecule capable of inhibiting more than one serine protease. Oxidation sensitivity would limit the place of action of EI to the immediate vicinity of carrier cells. The molecular structure will help clarify the likely role of EI in regulating protease action and preventing tissue damage by phagocytic cells.