Regulated intramembrane proteolysis (RIP) is an emerging paradigm in signal transduction. RIP is mediated by intramembrane-cleaving proteases (I-CliPs), which liberate biologically active nuclear or secreted domains from their membrane-tethered precursor proteins. The yeast Pcp1p/Rbd1p protein is a Rhomboid-like I-CliP that regulates mitochondrial membrane remodeling and fusion through cleavage of Mgm1p, a regulator of these essential activities. Although this ancient function is conserved in PARL (Presenilins-associated Rhomboid-like protein), the mammalian ortholog of Pcp1p/Rbd1p, the two proteins show a strong divergence at their N termini. However, the N terminus of PARL is significantly conserved among vertebrates, particularly among mammals, suggesting that this domain evolved a distinct but still unknown function. Here, we show that the cytosolic N-terminal domain of PARL is cleaved at positions 52-53 (alpha-site) and 77-78 (beta-site). Whereas alpha-cleavage is constitutive and removes the mitochondrial targeting sequence, beta-cleavage appears to be developmentally controlled and dependent on PARL I-CliP activity supplied in trans. The beta-cleavage of PARL liberates Pbeta, a nuclear targeted peptide whose sequence is conserved only in mammals. Thus, in addition to its evolutionarily conserved function in regulating mitochondrial dynamics, PARL might mediate a mammalian-specific, developmentally regulated mitochondria-to-nuclei signaling through regulated proteolysis of its N terminus and release of the Pbeta peptide.