Molecular analysis has provided important insights into the biochemistry and genetics of the sulphatase family of enzymes. Through bioinformatic searches of the EST database, we have identified a novel gene consisting of 11 exons and encoding a 525 aa protein that shares a high degree of sequence similarity with all sulphatases and in particular with arylsulphatases, hence the tentative name Arylsulfatase G (ARSG). The highest homology is shared with Arylsulfatase A, a lysosomal sulphatase which is mutated in metachromatic leukodistrophy, particularly in the amino-terminal region. The 10 amino acids that form the catalytic site are strongly conserved. The murine homologue of Arylsulfatase G gene product shows 87% identity with the human protein. To test the function of this novel gene we transfected the full-length cDNA in Cos7 cells, and detected an Arylsulfatase G precursor protein of 62 kDa. After glycosylation the precursor is maturated in a 70 kDa form, which localises to the endoplasmic reticulum. Northern blot analysis of Arylsulfatase G revealed a ubiquitous expression pattern. We tested the sulphatase activity towards two different artificial substrates 4-methylumbelliferyl (4-MU) sulphate and p-nitrocatechol sulphate, but no arylsulphatase activity was detectable. Further studies are needed to characterise the function of Arylsulfatase G, possibly revealing a novel metabolic pathway.