Valaciclovir is an oral prodrug of the antiherpetic agent acyclovir. An enzyme that hydrolyzes valaciclovir to acyclovir, valaciclovir hydrolase (VACVase), was purified from rat liver and characterized. VACVase was a basic (pI 9.4) protein associated with mitochondria. It was monomeric and had a molecular mass of 29 kDa. Amino acid sequences of six VACVase peptides, including its NH2 terminus (13 amino acids) and accounting for approximately 20% of its complete sequence, were not found in the SwissProt protein data base. VACVase hydrolyzed other amino acid esters of acyclovir in addition to valaciclovir (kcat/Km = 58 mM-1 s-1), with a preference for the L-alanyl (kcat/Km = 226 mM-1 s-1) and L-methionyl (kcat/Km = 200 mM-1 s-1) esters. It did not hydrolyze other types of esters or numerous di- and tripeptides and aminoacyl-beta-naphthylamides. Hydrolysis of valaciclovir by VACVase was not inhibited by amastatin, antipain, aprotinin, bestatin, chymostatin, E-64, EDTA, ebelactone A, ebelactone B, elastatinal, leupeptin, pepstatin, or phosphoramidon. It was neither inhibited nor activated by Ca2+, Co2+, Mg2+, Mn2+, or Zn2+. Therefore, this enzyme is not a typical esterase or peptidase and, to our knowledge, it has not been described previously. Its physiological function is not known; however, it may play a significant role in the biotransformation of valaciclovir to acyclovir.