We present the molecular cloning and sequencing of genomic and cDNA clones of the fox-2 gene of Neurospora crassa, encoding the multifunctional beta-oxidation protein (MFP). The coding region of the fox-2 gene is interrupted by three introns, one of which appears to be inefficiently spliced out. The encoded protein comprises 894 amino acid residues and exhibits 45% and 47% sequence identity with the MFPs of Candida tropicalis and Saccharomyces cerevisiae, respectively. Sequence analysis identifies three regions of the fungal MFPs that are highly conserved. These regions are separated by two segments that resemble linkers between domains of other MFPs, suggesting a three-domain structure. The first and second conserved regions of each MFP are homologous to each other and to members of the short-chain alcohol dehydrogenase family. We discuss these homologies in view of recent findings that fungal MFPs contain enoyl-CoA hydratase 2 and D-3-hydroxyacyl-CoA dehydrogenase activities, converting trans-2-enoyl-CoA via D-3-hydroxyacyl-CoA to 3-ketoacyl-CoA. In contrast to its counterparts in yeasts, the Neurospora MFP does not have a C-terminal sequence resembling the SKL motif involved in protein targeting to microbodies.