Nicastrin has been recently identified as part of the gamma-secretase complex that includes presenilin and other proteins. It is involved in the degradation of amyloid precursor protein to produce beta-amyloid peptides which are believed to be central to the pathophysiology of Alzheimer's disease. Previous reports have localized presenilin and nicastrin to the endoplasmic reticulum. However, during a proteomics-based characterization of lysosomal membrane proteins, a major spot observed on silver-stained IEF/SDS-PAGE gels was identified by mass spectrometric sequencing as nicastrin. Its M(r) corresponded to the reported mature M(r) for nicastrin, indicating that it is stable in the lysosomal environment. Furthermore, protease protection assays confirmed that nicastrin is contained in the outer lysosomal membrane, rather than in an internalized vesicle awaiting degradation, and that it is properly orientated with its amino-terminus facing the lysosomal lumen with its carboxyl-terminus facing the cytosol. We conclude that nicastrin is a resident lysosomal membrane protein.