Protein modification by methylation is important in cellular function. We show here that the Saccharomyces cerevisiae YBR261C/TAE1 gene encodes an N-terminal protein methyltransferase catalyzing the modification of two ribosomal protein substrates, Rpl12ab and Rps25a/Rps25b. The YBR261C/Tae1 protein is conserved across eukaryotes; all of these proteins share sequence similarity with known seven beta-strand class I methyltransferases. Wild-type yeast cytosol and mouse heart cytosol catalyze the methylation of a synthetic peptide (PPKQQLSKY) that contains the first eight amino acids of the processed N-terminus of Rps25a/Rps25b. However, no methylation of this peptide is seen in yeast cytosol from a DeltaYBR261C/tae1 deletion strain. Yeast YBR261C/TAE1 and the human orthologue METTL11A genes were expressed as fusion proteins in Escherichia coli and were shown to be capable of stoichiometrically dimethylating the N-terminus of the synthetic peptide. Furthermore, the YBR261C/Tae1 and METTL11A recombinant proteins methylate variants of the synthetic peptide containing N-terminal alanine and serine residues. However, methyltransferase activity is largely abolished when the proline residue in position 2 or the lysine residue in position 3 is substituted. Thus, the methyltransferases described here specifically recognize the N-terminal X-Pro-Lys sequence motif, and we suggest designating the yeast enzyme Ntm1 and the human enzyme NTMT1. These enzymes may account for nearly all previously described eukaryotic protein N-terminal methylation reactions. A number of other yeast and human proteins also share the recognition motif and may be similarly modified. We conclude that protein X-Pro-Lys N-terminal methylation reactions catalyzed by the enzymes described here may be widespread in nature.