Primary sequences of cholinesterases and related proteins have been systematically compared. The cholinesterase-like domain of these proteins, about 500 amino acids, may fulfill a catalytic and a structural function. We identified an aspartic acid residue that is conserved among esterases and lipases (Asp-397 in Torpedo acetylcholinesterase) but that had not been considered to be involved in the catalytic mechanism. Site-directed mutagenesis demonstrated that this residue is necessary for activity. Analysis of evolutionary relationships shows that the noncatalytic members of the family do not constitute a separate subgroup, suggesting that loss of catalytic activity occurred independently on several occasions, probably from bifunctional molecules. Cholinesterases may thus be involved in cell-cell interactions in addition to the hydrolysis of acetylcholine. This would explain their specific expression in well-defined territories during embryogenesis before the formation of cholinergic synapses and their presence in noncholinergic tissues.