The multisubunit signal peptidase catalyzes the cleavage of signal peptides and the degradation of some membrane proteins within the endoplasmic reticulum (ER). The only subunit of this enzyme functionally examined to date, yeast Sec11p, is related to signal peptidase I from bacteria. Since bacterial signal peptidase is capable of processing both prokaryotic and eukaryotic signal sequences as a monomer, it is unclear why the analogous enzyme in the ER contains proteins unrelated to signal peptidase I. To address this issue, the gene encoding Spc1p, the yeast homologue to mammalian SPC12, is isolated from the yeast Saccharomyces cerevisiae. Spc1p co-purifies and genetically interacts with Sec11p, but unlike Sec11p, Spc1p is not required for cell growth or the proteolytic processing of tested proteins in yeast. This indicates that only a subset of the ER signal peptidase subunits is required for signal peptidase and protein degradation activities in vivo. Through both genetic and biochemical criteria, Spc1p appears, however, to be important for efficient signal peptidase activity.