The water-soluble form of apoproteolipid (APL) from bovine brain myelin was found to bind with phosphatidylcholine (PC)/phosphatidylethanolamine (PE) (6:4) vesicles below pH 5. The protein bound to vesicles was photoactively labeled with 3-(trifluoromethyl)-3-(m-[125I]iodophenyl)diazirine [( 125I)TID) and was digested with trypsin. A [125I]TID-labeled fragment with an apparent molecular weight of approximately 2,500 was extracted. An APL fragment with an identical Mr value was also obtained from the tryptic digest of APL/vesicle complex without prior labeling with [125I]TID. Determination of amino acid composition and the identification of the N-terminal amino acid residue of this unlabeled fragment showed that this protected segment covers the amino acid residues from Met-205 to Lys-228. In another experiment, the [125I]TID-labeled APL obtained from the above experiment without the proteolysis step was extracted and reconstituted into PC vesicles. Subsequent tryptic digestion of the exposed segment and comparison of the elution profile of the extracted polypeptides on a Sephadex LH-60 column with the published profile of these polypeptides indicated that the membrane-inserted segment of the water-soluble form of APL when bound to vesicles is the C-terminal region of this apoprotein within the amino acid residues between Met-205 and Lys-268.