The mammalian brown fat inducible thioesterase variant 2 (BFIT2), also known as ACOT11, is a multimodular protein containing two consecutive hotdog-fold domains and a C-terminal steroidogenic acute regulatory protein-related lipid transfer domain (StarD14). In this study, we demonstrate that the N-terminal region of human BFIT2 (hBFIT2) constitutes a mitochondrial location signal sequence, which undergoes mitochondrion-dependent posttranslational cleavage. The mature hBFIT2 is shown to be located in the mitochondrial matrix, whereas the paralog "cytoplasmic acetyl-CoA hydrolase" (CACH, also known as ACOT12) was found in the cytoplasm. In vitro activity analysis of full-length hBFIT2 isolated from stably transfected HEK293 cells demonstrates selective thioesterase activity directed toward long chain fatty acyl-CoA thioesters, thus distinguishing the catalytic function of BFIT2 from that of CACH. The results from a protein-lipid overlay test indicate that the hBFIT2 StarD14 domain binds phosphatidylinositol 4-phosphate.