We recently identified Msp1p, a fission yeast Schizosaccharomyces pombe dynamin-related protein, which is essential for the maintenance of mitochondrial DNA. The Msp1p sequence displays typical features of a mitochondrial protein. Here we report in vitro and in vivo data that validate that prediction. We demonstrate that the targeting sequence of Msp1p is processed by recombinant mitochondrial processing peptidase and that Msp1p is imported into S. pombe mitochondria in vitro in the presence of cellular extracts. We show that the first 109 residues of Msp1p encompass a functional peptide signal that is sufficient to direct chimera to mitochondria. Immunofluorescence studies indicate that Msp1p staining colocalises with a mitochondrial marker and electron microscopy shows that the protein is located inside the mitochondria. Mitochondrial enrichment and fractionation further confirm that localisation and show that Msp1p is anchored to the matrix side of the mitochondrial inner membrane. Finally, we report that overexpression of the Msp1 protein results in gross alteration of the mitochondrial structure and function. All together our results suggest that Msp1p is an essential component for mitochondrial maintenance.