Thiazolidinediones address underlying causes of type 2 diabetes, although their mechanism of action is not clearly understood. The compounds are thought to function as direct activators of the nuclear receptor PPARgamma (peroxisome proliferator-activated receptor-gamma), although pioglitazone, the weaker agonist of the two thiazolidinediones now in clinical use, seems to have more useful effects on circulating lipids. We have used tritiated pioglitazone and a photoaffinity cross-linker to identify a novel binding site in mitochondria. A saturable binding site for [3H]pioglitazone was solubilized from the membranes with CHAPS and migrated as a large complex by size exclusion chromatography. The binding correlated with a <17-kDa protein (m17), marked by a photoaffinity cross-linker, in both subcellular location and selectivity of competition by analogs. The protein was isolated and identified by mass spectrometry analysis and NH2-terminal sequencing. Three synthetic peptides with potential antigenic properties were synthesized from the predicted nontransmembrane sequence to generate antibodies in rabbits. Western blots show that this protein, which we have termed "mitoNEET," is located in the mitochondrial fraction of rodent brain, liver, and skeletal muscle, showing the identical subcellular location and migration on SDS-PAGE as the protein cross-linked specifically by the thiazolidinedione photoprobe. The protein exists in low levels in preadipocytes, and expression increases exponentially in differentiated adipocytes. The synthetic protein bound to solid phase associated with a complex of solubilized mitochondrial proteins, including the trifunctional beta-oxidation protein. It is possible that thiazolidinedione modification of the function of the mitochondrial target may contribute to lipid lowering and/or antidiabetic actions.