In plants, the last step in the synthesis of p-aminobenzoate (PABA) moiety of folate remains to be elucidated. In Escherichia coli, this step is catalyzed by the PabC protein, a beta-lyase that converts 4-amino-4-deoxychorismate (ADC)--the reaction product of the PabA and PabB enzymes--to PABA and pyruvate. So far, the only known plant enzyme involved in PABA synthesis is ADC synthase, which has fused domains homologous to E. coli PabA and PabB and is located in plastids. ADC synthase has no lyase activity, implying that plants have a separate ADC lyase. No such lyase is known in any eukaryote. Genomic and phylogenetic approaches identified Arabidopsis and tomato cDNAs encoding PabC homologs with putative chloroplast-targeting peptides. These cDNAs were shown to encode functional enzymes by complementation of an E. coli pabC mutant, and by demonstrating that the partially purified recombinant proteins convert ADC to PABA. Plant ADC lyase is active as dimer and is not feedback inhibited by physiologic concentrations of PABA, its glucose ester, or folates. The full-length Arabidopsis ADC lyase polypeptide was translocated into isolated pea chloroplasts and, when fused to green fluorescent protein, directed the passenger protein to Arabidopsis chloroplasts in transient expression experiments. These data indicate that ADC lyase, like ADC synthase, is present in plastids. As shown previously for the ADC synthase transcript, the level of ADC lyase mRNA in the pericarp of tomato fruit falls sharply as ripening advances, suggesting that the expression of these two enzymes is coregulated.