Protein farnesyltransferase is a heterodimeric enzyme that attaches a farnesyl group to cysteine in ras proteins and other membrane-associated proteins. The beta subunit contains the recognition site for the peptide substrates, but is inactive in the absence of the alpha subunit. A cloned cDNA for the rat beta subunit predicts a protein of 437 amino acids whose mRNA is present in many tissues. Transfection of the beta subunit cDNA produced farnesyltransferase activity in human kidney cells, but only when it was transfected together with a cDNA encoding part of the alpha subunit. Each of the subunits appeared to be unstable in the transfected cells unless the other subunit was present. The rat beta subunit shows 37% sequence identity with the protein encoded by the yeast DPR1/RAM1 gene, indicating that DPR1/RAM1 is the yeast counterpart of the peptide-binding subunit of the mammalian farnesyltransferase.