A novel endoglucanase from Trichoderma reesei, EGIII, has been purified and its catalytic properties have been studied. The gene for that enzyme (egl3) and cDNA have been cloned and sequenced. The deduced EGIII protein shows clear sequence homology to a Schizophyllum commune enzyme (M. Yaguchi, personal communication), but is very different from the three other T. reesei cellulases with known structure. Nevertheless, all the four T. reesei cellulases share two common, adjacent sequence domains, which apparently can be removed by proteolysis. These homologous sequences reside at the N termini of EGIII and the cellobiohydrolase CBHII, but at the C termini of EGI and CBHI. Comparison of the fungal cellulase structures has led to re-evaluation of hypotheses concerning the localization of the active sites.