Prenylcysteine carboxyl methyltransferase (pcCMT) is the third of three enzymes that posttranslationally modify C-terminal CAAX motifs and thereby target CAAX proteins to the plasma membrane. Here we report the molecular characterization and subcellular localization of the first mammalian (human myeloid) pcCMT. The deduced amino acid sequence of mammalian pcCMT predicts a multiple membrane-spanning protein with homologies to the yeast pcCMT, STE14, and the mammalian band 3 anion transporter. The human gene complemented a ste14 mutant. pcCMT mRNAs were ubiquitously expressed in human tissues. An anti-pcCMT antiserum detected a 33-kDa protein in myeloid cell membranes. Ectopically expressed recombinant pcCMT had enzymatic activity identical to that observed in neutrophil membranes. Mammalian pcCMT was not expressed at the plasma membrane but rather restricted to the endoplasmic reticulum. Thus, the final enzyme in the sequence that modifies CAAX motifs is located in membranes topologically removed from the CAAX protein target membrane.