A gene of Haemophilus somnus encoding the major 40,000-molecular-weight antigen (LppA) was cloned on a 2-kb Sau3AI fragment. The nucleotide sequence of the entire DNA insert was determined. One open reading frame, encoding a 247-residue polypeptide with a calculated molecular weight of 27,072, was identified. This reading frame was confirmed by sequencing the fusion joint of two independent IppA::TnphoA gene fusions. The 21 amino-terminal amino acids of the deduced polypeptide showed strong sequence homology to the signal peptide of secreted proteins, and the sequence Leu-Leu-Ala-Ala-Cys at the putative cleavage site is identical to the consensus cleavage sequence of lipoproteins from gram-negative bacteria. The presence of the lipid moiety on the protein was shown by incorporation of radioactive palmitic acid into the natural H. somnus protein. Palmitic acid could also be incorporated into the recombinant protein in Escherichia coli. Synthesis of the mature LppA lipoprotein was inhibited by globomycin, showing that cleavage of the signal peptide is mediated by signal peptidase II in both organisms. By using site-directed mutagenesis, the cysteine residue at the cleavage site was changed to glycine. Radiolabelled palmitate was not incorporated into the mutated protein, showing that lipid modification occurs at the Cys-22 residue.