Lactococcus lactis subsp. cremoris P8-2-47 contains an X-prolyl dipeptidyl aminopeptidase (X-PDAP; EC 3.4.14.5). A mixed-oligonucleotide probe prepared on the basis of the N-terminal amino acid sequence of the purified protein was made and used to screen a partial chromosomal DNA bank in Escherichia coli. A partial XbaI fragment cloned in pUC18 specified X-PDAP activity in E. coli clones. The fragment was also able to confer X-PDAP activity on Bacillus subtilis. The fact that none of these organisms contain this enzymatic activity indicated that the structural gene for X-PDAP had been cloned. The cloned fragment fully restored X-PDAP activity in X-PDAP-deficient mutants of L. lactis. We have sequenced a 3.8-kb fragment that includes the X-PDAP gene and its expression signals. The X-PDAP gene, designated pepXP, comprises 2,289 nucleotide residues encoding a protein of 763 amino acids with a predicted molecular weight of 87,787. No homology was detected between pepXP and genes that had been previously sequenced. A second open reading frame, divergently transcribed, was present in the sequenced fragment; the function or relationship to pepXP of this open reading frame is unknown.