Small cell lung cancer (SCLC) cell lines and tumors invariably exhibit loss of heterozygosity (LOH) or, in rare cases, homozygous deletions involving part or all of chromosome arm 3p, suggesting the presence of 1 or more tumor-suppressor genes in this region. The gene encoding aminoacylase-I (ACYl) is localized on chromosome segment 3p21.1. ACYl enzymatic activity, protein, and mRNA have been demonstrated to be expressed at either undetectable or very low levels in a group of SCLC cell lines and tumors. The demonstration of mutational inactivation of ACYl would support the hypothesis that ACYl inactivation in SCLC confers a selective growth advantage. One of four SCLC cell lines with undetectable Acyl enzymatic activity and protein exhibited a compound mutation: nonconservative missense point mutations at codons 195 and 254. No wildtype sequence transcripts were identified in the cell line. Although nonmutational mechanisms for low or undetectable ACYl enzymatic activity, protein, and mRNA expression are most frequently operant in SCLC, the demonstration of a mutation supports selection for ACYl inactivation. Analysis of normal liver and a liver metastasis from the same patient from whom the NCI-H711 cell line was derived demonstrated that the mutation was neither germline nor an early event in the development of SCLC. It is of interest that several genes involved in the regulation of intracellular protein degradation are encoded by chromosome band 3p21 and display unusual expression in SCLC. The presence of other loci involved in protein degradation on chromosome band 3p21 and their aberrant expression in SCLC suggest that a variety of mechanisms involved in the normal degradation of intracellular proteins may be perturbed in this neoplasm.