Prior to virus assembly, the major coat protein of coliphage M13 is an integral protein of the host cytoplasmic membrane. Coat protein synthesized in vitro is initially made with an NH2-terminal "leader peptide" of 23 amino acids and is termed "procoat." We now report that procoat is a biosynthetic precursor of coat protein in vivo. Conversion of procoat to coat occurs within 30 sec in cells infected with wild-type virus. This proteolytic processing is delayed in cells infected by M13 mutants (in genes 1, 5, or 7) that are defective in virus assembly. Pulse--chase experiments in combination with subcellular fractionation show that procoat is synthesized in a soluble form in the cytoplasm and is then incorporated into the cytoplasmic membrane, where it is converted to coat protein. This finding is supported by the observation that procoat is synthesized exclusively by polysomes that are not membrane bound. These results are interpreted in terms of the "membrane-triggered folding" hypothesis of membrane protein assembly.