P-Glycoprotein, the multidrug transporter, is isolated from the plasma membrane of CHRC5 cells using a selective two-step detergent extraction procedure. The partially purified protein displays a high level of ATPase activity, which has a high KM for ATP, is stimulated by drugs, and can be distinguished from that of other membrane ATPases by its unique inhibition profile. Delipidation completely inactivates ATPase activity, which is restored by the addition of fluid lipid mixtures. P-Glycoprotein was reconstituted into lipid bilayers with retention of both drug transport and ATPase activity. Proteoliposomes containing P-glycoprotein display osmotically sensitive ATP-dependent accumulation of 3H-colchicine in the vesicle lumen. Drug transport is active, generating a stable 5.6-fold concentration gradient, and can be blocked by compounds in the multidrug resistance spectrum. Reconstituted P-glycoprotein also exhibits a high level of ATPase activity which is further stimulated by various drugs. P-Glycoprotein therefore functions as an active drug transporter with constitutive ATPase activity.