Incubation of the exocellular DD-carboxypeptidase/transpeptidase of Streptomyces R61 with phenylglyoxal resulted in a time-dependent decrease in the enzyme activity. This inactivation was demonstrated to be due to modification of the Arg-99 side chain. In consequence, the role of that residue was investigated by site-directed mutagenesis. Mutation of Arg-99 into leucine appeared to be highly detrimental to enzyme stability, reflecting a determining structural role for this residue. The conserved Arg-103 residue was also substituted by using site-directed mutagenesis. The modification to a serine residue yielded a stable enzyme, the catalytic properties of which were similar to those of the wild-type enzyme. Thus Arg-103, although strictly conserved or replaced by a lysine residue in most of the active-site penicillin-recognizing proteins, did not appear to fulfil any essential role in either the enzyme activity or structure.