The alpha-amidation of glycine-extended peptides is a two-step reaction catalyzed by peptidylglycine alpha-hydroxylating monooxygenase (PHM) and peptidylhydroxyglycine N-C lyase (PHL). PHL was purified to homogeneity from Xenopus laevis skin and its partial amino acid sequence (including the N-terminal 35 residues) was determined. It was found that the cDNA codes for a 935-residue precursor protein (AE-III protein), containing the PHM and PHL sequences at its N terminus and C terminus, respectively. The PHM sequence in AE-III protein is completely identical to that deduced from the nucleotide sequence of X. laevis AE-I cDNA, which encodes only PHM, except that the AE-I protein has an extra 10 residues at its C terminus. It is suggested that AE-I and AE-III mRNA are encoded by the same gene and produced by alternative splicing.