We have isolated the cDNAs encoding human and mouse homologues of a yeast protein, termed peroxisomal membrane protein 20 (PMP20). Comparison of the amino acid sequences of human (HsPMP20) and mouse (MmPMP20) PMP20 proteins revealed a high degree of identity (93%), whereas resemblance to the yeast Candida boidinii PMP20A and PMP20B (CbPMP20A and CbPMP20B) was less (30% identity). Both HsPMP20 and MmPMP20 lack transmembrane regions, as do CbPMP20A and CbPMP20B. HsPMP20 mRNA expression was low in human fetal tissues, especially in the brain. In adult tissues, HsPMP20 mRNA was expressed in the majority of tissues tested. HsPMP20 and MmPMP20 contained the C-terminal tripeptide sequence Ser-Gln-Leu (SQL), which is similar to the peroxisomal targeting signal 1 utilized for protein import into peroxisomes. HsPMP20 bound directly to the human peroxisomal targeting signal 1 receptor, HsPEX5. Mutagenesis analysis showed that the C-terminal tripeptide sequence, SQL, of HsPMP20 is necessary for its binding to HsPEX5. Subcellular fractionation of HeLa cells, expressing epitope-tagged PMP20, revealed that HsPMP20 is localized in the cytoplasm and in a particulate fraction containing peroxisomes. Double-staining immunofluorescence studies showed colocalization of HsPMP20 and thiolase, a bona fide peroxisomal protein. The amino acid sequence alignment of HsPMP20, MmPMP20, CbPMP20A, and CbPMP20B displayed high similarity to thiol-specific antioxidant proteins. HsPMP20 exerted an inhibitory effect on the inactivation of glutamine synthetase in the thiol metal-catalyzed oxidation system but not in the nonthiol metal-catalyzed oxidation system, suggesting that HsPMP20 possesses thiol-specific antioxidant activity. In addition, HsPMP20 removed hydrogen peroxide by its thiol-peroxidase activity. These results indicate that HsPMP20 is imported into the peroxisomal matrix via PEX5p and may work to protect peroxisomal proteins against oxidative stress. Because some portion of PMP20 might also be present in the cytosol, HsPMP20 may also have a protective effect in the cytoplasm.