We describe a new cystatin in both mice and humans, which we termed leukocystatin. This protein has all the features of a Class II secreted inhibitory cystatin but contains lysine residues in the normally hydrophobic binding regions. As determined by cDNA library Southern blots, this cystatin is expressed selectively in hematopoietic cells, although fine details of the distribution among these cell types differ between the human and mouse mRNAs. In addition, we have determined the genomic organization of mouse leukocystatin, and we found that in contrast to most cystatins, the leukocystatin gene contains three introns. The recombinant proteins corresponding to these cystatins were expressed in Escherichia coli as N-terminal glutathione S-transferase or FLAGTM fusions, and studies showed that they inhibited papain and cathepsin L but with affinities lower than other cystatins. The unique features of leukocystatin suggests that this cystatin plays a role in immune regulation through inhibition of a unique target in the hematopoietic system.