Caspase-activated DNase (CAD) is an enzyme that cleaves chromosomal DNA in apoptotic cells. Here, we identified a DNase in Drosophila Schneider cells that can be activated by caspase 3, and purified it as a complex of two subunits (p32 and p20). Using primers based on the amino acid sequence of the purified proteins, a cDNA coding for Drosophila CAD (dCAD) was cloned. The polypeptide encoded by the cDNA contained 450 amino acids with a calculated M(r) of 52,057, and showed significant homology with human and mouse CAD (22% identity). Mammalian CADs carry a nuclear localization signal at the C terminus. In contrast, dCAD lacked the corresponding sequence, and the purified dCAD did not cause DNA fragmentation in nuclei in a cell-free system. When dCAD was co-expressed in COS cells with Drosophila inhibitor of CAD (dICAD), a 52-kDa dCAD was produced as a heterotetrameric complex with dICAD. When the complex was treated with human caspase 3 or Drosophila caspase (drICE), the dICAD was cleaved, and released from dCAD. In addition, dCAD was also cleaved by these caspases, and behaved as a (p32)(2)(p20)(2) complex in gel filtration. When a Drosophila neuronal cell line was induced to apoptosis by treatment with a kinase inhibitor, both dCAD and dICAD were cleaved. These results indicated that unlike mammalian CAD, Drosophila CAD must be cleaved by caspases to be activated.