The enzyme peptidylarginine deiminase (PAD; EC 184.108.40.206) is responsible for the formation of protein-bound citrulline, a major amino acid in the inner root sheath (IRS) and in the medulla of the hair follicle. From mainly biochemical evidence, it is known that the substrate for the enzyme is trichohyalin and that trichohyalin granules gradually disappear to form a matrix with intermediate-like filaments in the IRS cells. In the medulla, the granules aggregate into large masses without filaments. The proteins in both the IRS and medulla are finally cross-linked by transglutaminase. A corollary of the apparent central role of PAD acting on the trichohyalin protein in these processes is that it should be present in the IRS and medulla cells, coincident with trichohyalin. Hair-follicle PAD has not previously been isolated. In the current study, the enzyme was isolated from wool follicles of adult sheep and peptide sequences were used to design DNA primers for the synthesis of PCR products from follicle mRNA. Subsequently, a PAD-specific complementary RNA probe and a trichohyalin complementary RNA probe were prepared for localization studies by in situ hybridization in wool follicles and the epithelia of the rumen, embryonic hoof, and tongue papillae. The experiments have revealed a striking co-expression of PAD and trichohyalin in all of these tissues. The amino acid sequence of the wool-follicle PAD molecule has been deduced from sequencing of the cloned PCR products.