Several peroxisomal proteins do not contain the previously identified tripeptide peroxisomal targeting signal (PTS) at their carboxy-termini. One such protein is the peroxisomal 3-ketoacyl CoA thiolase, of which two types exist in rat [Hijikata et al. (1990) J. Biol. Chem., 265, 4600-4606]. Both rat peroxisomal thiolases are synthesized as larger precursors with an amino-terminal prepiece of either 36 (type A) or 26 (type B) amino acids, that is cleaved upon translocation of the enzyme into the peroxisome. The prepieces are necessary for import of the thiolases into peroxisomes because expression of an altered cDNA encoding only the mature thiolase, which lacks any prepiece, results in synthesis of a cytosolic enzyme. When appended to an otherwise cytosolic passenger protein, the bacterial chloramphenicol acetyltransferase (CAT), the prepieces direct the fusion proteins into peroxisomes, demonstrating that they encode sufficient information to act as peroxisomal targeting signals. Deletion analysis of the thiolase B prepiece shows that the first 11 amino acids are sufficient for peroxisomal targeting. We conclude that we have identified a novel PTS that functions at amino-terminal or internal locations and is distinct from the C-terminal PTS. These results imply the existence of two different routes for targeting proteins into the peroxisomal matrix.