SpYPT5p is a member of the rab/YPT small GTP-binding protein family, which is believed to be involved in the regulation of intracellular trafficking. The protein sequence terminates with a CXC motif, and in our previous report (Newman, C. M. H., Giannakouros, T., Hancock, J. F., Fawell, E. H., Armstrong, J., and Magee, A. I. (1992) J. Biol. Chem. 267, 11329-11336) we have shown that SpYPT5p is prenylated both in vivo and in vitro, where geranylgeranylation was confirmed, and carboxyl-methylated. In order to dissect the role of prenylation of each cysteine, we have generated C-terminal mutants where either one or both cysteine(s) were replaced by serine and expressed them in vitro in reticulocyte lysates and in vivo in transfected COS cells. Our results suggest that both cysteines of the CXC motif are prenylated but that the rate of prenylation of the two cysteines is different. The upstream cysteine was found to be preferentially prenylated in reticulocyte lysates unless cytosol from COS cells was added. A separate activity could therefore be required for prenylation of the second cysteine, or the presence of an additional factor is needed to allow accumulation of doubly prenylated SpYPT5p. However, the modification of the upstream cysteine is not a prerequisite for the prenylation of the other. Furthermore, gene replacement in Schizosaccharomyces pombe revealed that each cysteine of the CXC motif can individually support function. Carboxyl methylation occurred only on protein which had been prenylated on the C-terminal cysteine and was required for efficient membrane binding in vitro.