Cytochrome P450 2E1 (CYP2E1) lacking the hydrophobic NH(2)-terminal hydrophobic transmembrane domain is specifically targeted to mitochondria, where it is processed to a soluble and catalytically active form (Delta2E1) with a mass of about 40 kDa. Small amounts of Delta2E1 were also observed in mitochondria isolated from rat liver, indicating that this form of CYP2E1 is also present in vivo. In the present study the mitochondrial targeting signal was identified and characterized by the use of several NH(2)-terminally truncated and mutated forms of CYP2E1 that were expressed in the mouse H2.35 hepatoma cell line. Two potential mitochondrial targeting sequences were identified in the NH(2) terminus of CYP2E1. Deletion of the first potential mitochondrial targeting sequence located between amino acids 50 and 65, as in Delta(2-64)2E1, still resulted in mitochondrial targeting and processing, but when, in addition to the first, the second potential mitochondrial targeting sequence located between amino acids 74 and 95 was also deleted, as in Delta(2-95)2E1, the mitochondrial targeting was abolished. Mutation of the four positively charged Arg and Lys residues present in this sequence to neutral Ala residues resulted in the abrogation of mitochondrial targeting. Deletion of a hydrophobic stretch of amino acids between residues 76 and 83 also abolished mitochondrial targeting and import. Once imported in the mitochondria, these constructs were further processed to the mature protein Delta2E1. It is concluded that mitochondrial targeting of CYP2E1 is mediated through a sequence located between residues 74 and 95 and that positively charged residues as well as a hydrophobic stretch present in the beginning of this sequence are essential for this process.