1. A cyclic nucleotide phosphodiesterase (EC 3.1.4.16) has been partially purified from bovine rod outer segments. The enzyme preparation obtained has a very high specific activity towards cyclic GMP and is still able to hydrolyze cyclic AMP. Upon polyacrylamide gel electrophoresis, one major and three minor protein bands are seen, the enzyme activity being associated with the major band. The enzyme eluted from the gels still hydrolyzes both cyclic nucleotides. At all substrate concentrations tested, cyclic GMP was hydrolyzed at a faster rate. The enzyme eluted from the gel columns migrated as a single band upon electrophoresis in 0.1% sodium dodecyl sulfate-polyacrylamide gels corresponding to a molecular weight of 105 000. 2. A complex kinetic pattern was observed for cyclic GMP hydrolysis: the plot of velocity vs substrate concentration was hyperbolic at low and sigmoidal at higher concentrations. By contrast, simple kinetics were observed for cyclic AMP hydrolysis yielding an apparent Km of 0.1 mM. The unusual kinetics may be implicated in the regulation of cyclic GMP levels in rod outer segments. 3. Cyclic AMP stimulated the hydrolysis of cyclic GMP at low and inhibited it at higher concentrations. Addition of Mg2+ appeared to be necessary for optimum activity. The activity measured in the absence of exogenous Mg2+ was abolished by EDTA.