Trypanosoma brucei contains a membrane-bound phospholipase C which converts the variant surface glycoprotein (VSG), anchored in the membrane by a C-terminal glycosyl-phosphatidylinositol moiety, into a soluble form and diacylglycerol. The amino acid sequence (358 residues) of this enzyme, derived from the nucleotide sequence of the cDNA and the gene, reveals a polypeptide which lacks an obvious N-terminal signal sequence and stretches of exclusively hydrophobic residues. These properties suggest that the phospholipase is synthesized in the cytoplasm and subsequently associates with or translocates across intracellular membranes. There are much higher levels of glycosyl-phosphatidylinositol specific phospholipase C mRNA in bloodstream form than in procyclic form trypanosomes. The phospholipase gene is probably present in one or two copies per haploid genome, probably not associated with VSG expression sites.