The distribution of alanine:glyoxylate aminotransferase 1 (AGT) within liver cells has changed many times during mammalian evolution. Depending on the particular species, AGT can be found in mitochondria or peroxisomes, or mitochondria and peroxisomes. In some cases significant cytosolic AGT is also present. In the livers of most rodents, AGT has what is thought to be the more 'ancestral' distribution (i.e. mitochondrial and peroxisomal). However, AGT is distributed very differently in the guinea pig, being peroxisomal and cytosolic. In this study, we have attempted to determine the molecular basis for the loss of mitochondrial AGT targeting and the apparent inefficiency of peroxisomal targeting of AGT in the guinea pig. Our results show that the former is owing to the evolutionary loss of the more 5' of two potential transcription and translation initiation sites, resulting in the loss of the ancestral N-terminal mitochondrial targeting sequence from the open reading frame. Guinea pig AGT is targeted to peroxisomes via the peroxisomal targeting sequence type 1 (PTS1) peroxisomal import machinery, even though its C-terminal tripeptide, HRL, deviates from the standard consensus PTS1 motif. Although HRL appears to target AGT to peroxisomes less efficiently than the classical PTS1 SKL, the main reason for the low efficiency of AGT peroxisomal targeting in guinea pig cells (compared with cells from other species) lies not with guinea pig AGT but with some other, as yet undefined, part of the guinea pig peroxisomal import machinery.