Studies in intact cells have shown the following processing reaction to occur during Asn-linked oligosaccharide biosynthesis (M, mannose; GlcNAc, N-acetylglucosamine): Formula: (See Text) We have identified a rat liver Golgi enzyme which catalyzes this reaction in vitro. This alpha-mannosidase has been purified 3,000 to 6,000-fold by subcellular fractionation, Triton X-100 solubilization, and ion exchange and hydroxylapatite chromatography. The purified enzyme has a pH optimum between 6.0 and 6.5 and a Km between 17 and 100 microM for a processing intermediate. The enzyme shows specificity for alpha 1,2-linked mannose residues. Structural analysis of the in vitro reaction products reveal that specific intermediates are formed in the conversion of the (Man)9GlcNAc oligosaccharide to the (Man)5GlcNAc oligosaccharide. Heat inactivation studies are consistent with the possibility that one enzyme activity is responsible for this conversion. The alpha 1,2-specific mannosidase described here appears to be distinct from two other rat liver Golgi alpha-mannosidase activities based on differential substrate specificity, inhibitor susceptibility, and detergent extractability.