Genome sequencing of the thermophilic archaeon Pyrococcus horikoshii OT3 revealed a gene which had high sequence similarity to the gene encoding the carboxypeptidase of Sulfolobus solfataricus and also to that encoding the aminoacylase from Bacillus stearothermophilus. The gene from P. horikoshii comprises an open reading frame of 1,164 bp with an ATG initiation codon and a TGA termination codon, encoding a 43,058-Da protein of 387 amino acid residues. However, some of the proposed active-site residues for carboxypeptidase were not found in this gene. The gene was overexpressed in Escherichia coli with the pET vector system, and the expressed enzyme had high hydrolytic activity for both carboxypeptidase and aminoacylase at high temperatures. The enzyme was stable at 90°C, with the highest activity above 95°C. The enzyme contained one bound zinc ion per one molecule that was essential for the activity. The results of site-directed mutagenesis of Glu367, which corresponds to the essential Glu270 in bovine carboxypeptidase A and the essential Glu in other known carboxypeptidases, revealed that Glu367 was not essential for this enzyme. The results of chemical modification of the SH group and site-directed mutagenesis of Cys102 indicated that Cys102 was located at the active site and was related to the activity. From these findings, it was proven that this enzyme is a hyperthermostable, bifunctional, new zinc-dependent metalloenzyme which is structurally similar to carboxypeptidase but whose hydrolytic mechanism is similar to that of aminoacylase. Some characteristics of this enzyme suggested that carboxypeptidase and aminoacylase might have evolved from a common origin.