A synthetic gene encoding horseradish peroxidase isoenzyme C (HRP C) has been synthesized and expressed in Escherichia coli. The nonglycosylated recombinant enzyme (HRP C*) was produced in inclusion bodies in an insoluble inactive form containing only traces of heme. HRP C* was solubilized and conditions under which it folded to give active enzyme were determined. Folding was shown to be critically dependent upon the concentrations of urea, Ca2+, and heme and on oxidation by oxidized glutathione. Purification of active HRP C* from the folding mixture gave a peroxidase, with about half the activity of HRP C. Glycosylation is thus not essential for correct folding and activity. The C-terminal and N-terminal extensions to HRP identified previously in cloned cDNA sequences are also not required for correct folding. However, Ca2+ appears to play a key role in folding to give the active enzyme. The overall yield of purified active enzyme was 2-3%, but this could be increased by reprocessing material that precipitated during folding.