Two criteria suggest that most of the proteinase of Streptococcus lactis is localized in the cell wall. (i) Intact cells possess proteinase activity when incubated with a high-molecular-weight substrate. (ii) Most of the cell-bound proteinase activity is released during spheroplast formation under conditions which result in the release of only 1% of the intracellular enzymes aldolase and glyceraldehyde-3-phosphate dehydrogenase. The solubilized cell wall, plasma membrane, and cytoplasm fractions contained 84, 0, and 16%, respectively, of the total proteinase activity with casein as substrate. The physiological role of a surface-bound proteinase in this organism is discussed.