The precursor to the Euglena light-harvesting chlorophyll a/b-binding protein of photosystem II (pLHCPII) is unique; it is a polyprotein, synthesized on membrane-bound ribosomes and transported to the Golgi apparatus prior to chloroplast localization. A cDNA corresponding to the 5' end of LHCPII mRNA has been isolated and sequenced. The deduced amino acid sequence of this cDNA indicates that Euglena pLHCPII contains a 141-amino acid N-terminal extension. The N-terminal extension contains three hydrophobic domains and a potential signal peptidase cleavage site at amino acid 35. Cotranslational processing by canine microsomes removed approximately 35 amino acids from an in vitro synthesized 33-kDa pLHCPII composed of a 141-amino acid N-terminal extension and a 180-amino acid partial LHCPII unit truncated at the beginning of the third membrane-spanning hydrophobic domain. Processed pLHCPII was degraded by exogenous protease, indicating that it had not been translocated to the microsomal lumen. Extraction with 0.1 M Na2CO3, pH 11.5, did not remove the processed pLHCPII from the microsomal membrane. A stop-transfer membrane anchor sequence appears to anchor the nascent protein within the membrane, preventing translocation into the lumen. Taken together, these results provide biochemical evidence for a functional cleaved signal sequence within the N-terminal extension of a Euglena cytoplasmically synthesized chloroplast-localized protein.