We have previously identified and characterized a metalloproteinase from Drosophila that cleaves insulin and transforming growth factor-alpha, but not epidermal growth factor, at physiological concentrations. On the basis of enzymatic properties and substrate specificity, this enzyme was identified as the Drosophila homolog of the mammalian insulin-degrading enzyme (IDE). We now report the cloning and sequencing of the cDNA coding for the Drosophila IDE (dIDE). Northern blot analysis indicates that the dIDE is translated from a 3.6-kilobase transcript similar in size to one of the two human IDE transcripts. The gene for the dIDE has been mapped to chromosome 3L (77B). The sequence of the dIDE is very similar to that of the human IDE, and both enzymes share limited but significant identity with the bacterial metalloproteinase protease III. Indirect studies based upon inhibitors, degradation products, and microinjected antibodies have suggested that the IDE can initiate cellular insulin degradation in mammalian cells. To determine whether dIDE expressed in mammalian cells can also degrade insulin, we transfected the cDNA into murine NIH3T3 cells. Extracts of the transfected cells showed increased insulin-degrading activity, demonstrating that the dIDE can be functionally expressed in mammalian cells. These results indicate that the properties of the IDE are evolutionarily conserved.