The axe-txe operon encodes a toxin-antitoxin (TA) pair, Axe-Txe, that was initially identified on the multidrug-resistance plasmid pRUM in Enterococcus faecium. In Escherichia coli, expression of the Txe toxin is known to inhibit cell growth, and co-expression of the antitoxin, Axe, counteracts the toxic effect of Txe. Here, we report the nucleotide sequence of pS177, a 39 kb multidrug-resistant plasmid isolated from vancomycin-resistant Ent. faecium, which harbours the axe-txe operon and the vanA gene cluster. RT-PCR analysis revealed that the axe-txe transcript is produced by strain S177 as well as by other vancomycin-resistant enteroccoci. Moreover, we determine the mechanism by which the Txe protein exerts its toxic activity. Txe inhibits protein synthesis in E. coli without affecting DNA or RNA synthesis, and inhibits protein synthesis in a cell-free system. Using in vivo primer extension analysis, we demonstrate that Txe preferentially cleaves single-stranded mRNA at the first base after an AUG start codon. We conclude that Txe is an endoribonuclease which cleaves mRNA and inhibits protein synthesis.