By using computer-based homology searches of the Arabidopsis genome, we identified the gene for ACH2, a putative acyl-CoA thioesterase. With the exception of a unique 129-amino acid N-terminal extension, the ACH2 protein is 17-36% identical to members of a family of acyl-CoA thioesterases that are found in both prokaryotes and eukaryotes. The eukaryotic homologs of ACH2 are peroxisomal acyl-CoA thioesterases that are up-regulated during times of increased fatty acid oxidation, suggesting potential roles in peroxisomal beta-oxidation. We investigated ACH2 to determine whether it has a similar role in the plant cell. Like its eukaryotic homologs, ACH2 carries a putative type 1 peroxisomal targeting sequence (-SKL(COOH)), and maintains all the catalytic residues typical of this family of acyl-CoA thioesterases. Analytical ultracentrifugation of recombinant ACH2-6His shows that it associates as a 196-kDa homotetramer in vitro, a result that is significant in light of the cooperative kinetics demonstrated by ACH2-6His in vitro. The cooperative effects are most pronounced with medium chain acyl-CoAs, where the Hill coefficient is 3.8 for lauroyl-CoA, but decrease for long chain acyl-CoAs, where the Hill coefficient is only 1.9 for oleoyl-CoA. ACH2-6His hydrolyzes both medium and long chain fatty acyl-CoAs but has highest activity toward the long chain unsaturated fatty acyl-CoAs. Maximum rates were found with palmitoleoyl-CoA, which is hydrolyzed at 21 micromol/min/mg protein. Additionally, ACH2-6His is insensitive to feedback inhibition by free CoASH levels as high as 100 microm. ACH2 is most highly expressed in mature tissues such as young leaves and flowers rather than in germinating seedlings where beta-oxidation is rapidly proceeding. Taken together, these results suggest that ACH2 activity is not linked to fatty acid oxidation as has been suggested for its eukaryotic homologs, but rather has a unique role in the plant cell.