Partial amino acid sequence has been determined for the cone, alpha' subunit of the bovine photoreceptor cyclic nucleotide phosphodiesterase (PDE) and deduced from nucleotide sequences of a partial cDNA clone. These sequences identify the alpha' subunit as the product of a gene that is distinct from those encoding the alpha or beta subunits of the membrane-associated rod photoreceptor PDE. Comparisons between the recently determined cGMP-stimulated-PDE sequence and those of the alpha and alpha' photoreceptor PDE subunits reveal an unexpected sequence similarity. In addition to the catalytic domain conserved in eukaryotic PDEs, all three PDEs possess a second conserved segment of approximately 340 residues that contains two internally homologous repeats. Limited proteolysis and direct photolabeling studies indicate that the noncatalytic, cGMP-binding site(s) in the cGMP-stimulated PDE is located within this conserved domain, suggesting that it also may serve this function in the photoreceptor PDEs. Moreover, other PDEs that do not bind cGMP at noncatalytic sites do not contain this conserved domain. The function of the conserved segment in the photoreceptor PDEs is not known, but the homology to allosteric sites of the cGMP-stimulated PDE suggests a role in cGMP binding and modulation of enzyme activity.