A full-length cDNA clone encoding the alpha' subunit of cGMP phosphodiesterase (PDE) from bovine cone photoreceptors was selected by probing a retinal library with a DNA fragment encoding the catalytic core of the rod cGMP PDE alpha subunit. Identity of the clone was confirmed by comparing its deduced sequence with cone PDE peptide sequences determined by Charbonneau et al. [Charbonneau, H., Prusti, R. K., LeTrong, H., Sonnenburg, W. K., Mullaney, P. J., Walsh, K. A. & Beavo, J. A. (1990) Proc. Natl. Acad. Sci. USA, pp. 288-292]. The cone PDE alpha' and the rod PDE alpha and beta subunits are encoded by distinct genes. cGMP PDE subunits share a common ancestry with cAMP PDEs and cyclic nucleotide-binding proteins. Sequence comparisons predict the presence of a catalytic core and possible secondary sites for noncatalytic cGMP binding. The presence of a C-terminal CAAX (Cys-aliphatic-aliphatic-Xaa) motif suggests the cone enzyme may be posttranslationally modified by proteolysis, methylation, and isoprenylation.