Co-translational insertion of liver microsomal cytochrome P-450 into the endoplasmic reticulum membrane is mediated by the signal recognition particle (SRP) and the presence in the cytochrome molecule of a signal sequence that can be recognized by SRP has been postulated. To locate this signal sequence, six hybrid cDNAs were constructed in which various segments of a cDNA for a rabbit liver cytochrome P-450 are fused with a cDNA or its fragment encoding yeast porin (an outer mitochondrial membrane protein) or with a cDNA for pre-interleukin 2 (a secretory protein) from which the 5'-terminal portion encoding most of its signal sequence had been removed. These hybrid cDNAs were inserted into an SP-6 transcription vector and transcribed in vitro. The mRNAs thus synthesized were translated in a cell-free system in the presence of rough microsomes. It was thus found that only those chimeric proteins containing (at their amino-terminal end) the amino-terminal cytochrome P-450 segments consisting of greater than or equal to 29 amino acid residues were co-translationally inserted into the membrane in an SRP-dependent fashion. These proteins were, however, neither processed nor translocated across the membrane. These findings, coupled with the observation that the major portion of these proteins, when inserted into the membrane, was degraded by trypsin, led to the conclusion that a short amino-terminal segment (less than 29 residues) of the cytochrome P-450 functions not only as an insertion signal but also as a stop-transfer sequence. This segment is, therefore, similar to the internal signal of type II plasma membrane proteins, but differs from the latter in the topogenic function.