The "protective protein" is a glycoprotein that associates with lysosomal beta-galactosidase and neuraminidase and is deficient in the autosomal recessive disorder galactosialidosis. We have isolated the cDNA encoding human "protective protein". The clone recognizes a 2 kb mRNA in normal cells that is not evident in fibroblasts of an early infantile galactosialidosis patient. The cDNA directs the synthesis of a 452 amino acid precursor molecule that is processed in vivo to yield mature "protective protein," a heterodimer of 32 kd and 20 kd polypeptides held together by disulfide bridges. This mature form is also biologically functional since it restores beta-galactosidase and neuraminidase activities in galactosialidosis cells. The predicted amino acid sequence of the "protective protein" bears homology to yeast carboxypeptidase Y and the KEX1 gene product. This suggests a protease activity for the "protective protein."