The placental protein 11 (PP11) can act as a tumor marker because of its specific association with various forms of cancer. A lambda gt11 cDNA library prepared from human placenta was screened with a polyclonal anti-PP11 antiserum. Out of 10(6) independent clones, only one clone reacted with the anti-PP11 antiserum. The isolated cDNA coded only for the carboxy-terminal part of PP11 and was subsequently used to rescreen a lambda gt10 placental cDNA library. Two cDNA clones out of 10(6) screened were identified encoding the entire protein of 369 amino acids, including a typical hydrophobic signal sequence of 18 amino acids. Expression of the PP11 cDNA coding sequence in Escherichia coli resulted in the synthesis of a protein with the expected size which can be specifically immunoprecipitated with anti-PP11 antiserum. Fractionation experiments revealed that two forms of the protein are present in the bacterial cell: a higher-molecular-weight form of approximately 42 kD in the cytoplasm and a smaller-molecular-weight form of approximately 42 kD in the periplasm. This result indicates that PP11 can be synthesized in E. coli and is process by removal of the hydrophobic signal sequence. Both the placental and the processed recombinant PP11 protein exhibit a protease activity.