Sepiapterin synthase, the enzyme system responsible for the synthesis of sepiapterin from dihydroneopterin triphosphate, has been partially purified from extracts of the heads of young adult fruit flies (Drosophila melanogaster). The sepiapterin synthase system consists of two components, termed "enzyme A" (MW 82,000) and "enzyme B" (MW 36,000). Some of the properties of the enzyme system are as follows: NADPH and a divalent cation, supplied most effectively as MgCl2, are required for activity; optimal activity occurs are pH 7.4 and 30 C; the Km for dihydroneopterin triphosphate is 10 microM; and a number of unconjugated pterins, including biopterin and sepiapterin, are inhibitory. Dihydroneopterin cannot be used as substrate in place of dihydroneopterin triphosphate. Evidence is presented in support of a proposed reaction mechanism for the enzymatic conversion of dihydroneopterin triphosphate to sepiapterin in which enzyme A catalyzes the production of a labile intermediate by nonhydrolytic elimination of the phosphates of dihydroneopterin triphosphate, and enzyme B catalyzes the conversion of this intermediate, in the presence of NADPH, to sepiapterin. An analysis of the activity of sepiapterin synthase during development in Drosophila revealed the presence of a small amount of activity in eggs and young larvae and a much larger amount in late pupae and young adults. Sepiapterin synthase activity during development corresponds with the appearance of sepiapterin in the flies. Of a variety of eye color mutants of Drosophila melanogaster tested for sepiapterin synthase activity, only purple (pr) flies contained activity that was significantly lower than that found in the wild-type flies (22% of the wild-type activity). Further studies indicated that the amount of enzyme A activity is low in purple flies, whereas the amount of enzyme B activity is equal to that present in wild-type flies.